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The rapid rise of China's and India's economy has attracted the attention of the world. The automotive industry in China and India, despite being favored by the world's auto giants, and even investing in them, is quite different.
First, the market size is different. In terms of quantity, the Chinese automobile market is 3 to 4 times that of India. From a time point of view, it takes about 10 years for India to reach the current scale of the Chinese passenger vehicle market.
As the only two countries in the world with more than one billion people, China and India still have very low car ownership. Up to now, India has less than 10 cars per 1,000 people, which is equivalent to China's 1995 level (8.6 cars per 1,000 people). At present, this figure in China is about 30 cars per 1,000 people.
Research agency forecasts show that from 2006 to 2012, the average growth rate of the global auto market is only 1% to 1.5%, the Chinese auto market growth rate will remain at 15%, while the Indian market growth rate during the same period is 8% .
According to the latest statistics, from January to November 2006, China's passenger car sales reached 3.4 million units. According to forecasts, by 2015, the annual sales of passenger cars in the Indian automobile market will reach around 3.5 million.
The big background of the two different car markets is that the two countries have different economic growth rates. Last week, a senior researcher at the School of Economics and Management at Tsinghua University once said that China’s economic growth has increased at a rate of 10% for four consecutive years, while India’s growth rate is only 8%; India’s growth rate is far higher than the population growth rate. China. Therefore, the distance between the two countries is still growing.
This difference in economic growth is directly reflected in the different infrastructure constructions such as road traffic and parking lots and the differences in purchasing power of ordinary people. These factors have profoundly affected and restricted the development of the automobile industry in both countries.
Second, foreign forces are different. The multinational automobile groups that come to invest in China are almost “without a net†and they all have a certain scale. India's auto companies are relatively concentrated in several joint ventures and form "one dominance."
There is a saying in the Chinese auto industry: Among the multinational corporations, the ones that come are all coming. In comparison, this sentence is even more a "when completed."
In the past 20 years, many multinational companies have invested in the Chinese auto industry (of course, through joint ventures), and many of them have production scales of 1 million vehicles, and their sales performance has reached 70% to 80%.
For example, according to the statistics of General Motors Corporation, the world’s largest automotive group, its joint ventures in China have more than 1 million production facilities in factories in Shanghai, Yantai, Shenyang, Liuzhou and Qingdao. In 2006, General Motors sold more than 800,000 vehicles in China (Shanghai GM, SAIC-GM-Wuling, and GM-imported vehicles).
Similarly, the largest auto group in Europe, Volkswagen, has a capacity of more than 1 million vehicles in China, and actual sales (Shanghai Volkswagen, FAW-Volkswagen and Volkswagen imported cars) have reached 700,000 vehicles.
In addition, production capacities such as Toyota, Ford, Honda, and Hyundai (including Kia) have already been formed or are under construction at more than 500,000 vehicles, and the next step in competition is mainly to maximize product competitiveness and production capacity.
In the automotive industry in India, the previous large-scale investment was only in the auto group in the second camp of the world, such as Suzuki of Japan and Hyundai Motors. The competition was not sufficient and the market share of Suzuki Motor was once nearly 80. In recent years, only large-scale investments by GM, Ford, Dai-Ke, Volkswagen, Toyota, and other giant companies have been vividly described as “progressiveâ€.
Third, there are different opportunities for development. China’s reform and opening up has won certain time and space for the development of the automobile industry; precisely at this time, the Indian automobile industry once appeared flawed.
As early as the early 1980s, the Chinese government actively promoted the use of foreign investment in the automotive industry. From two years in 1984, it established Sino-foreign joint ventures such as Beijing Jeep, Shanghai Volkswagen, and Guangzhou Peugeot. Then there are larger-scale joint ventures such as FAW-Volkswagen, Dongfeng Citroen, and other commercial vehicle joint ventures such as JMC, Qingling, and CNHTC.
It should be said that almost at the same time, India also determined to vigorously develop the automobile industry. In 1983, the Indian government established Maruti Udyog Co., Ltd. directly with Suzuki Corporation of Japan to produce Maruti 800, an Alto minicar. Nearly three-quarters of the shares are Indian-owned. However, due to a single product and low consumer purchasing power, the production and sales of Indian cars have stagnated since the 1990s.
In 1993, the Indian government began to adjust the relevant industrial policies and conditionally opened the doors of cooperation to the international car giants.
Interestingly, the auto companies that have succeeded in the Indian market are precisely the ones that are not in the Chinese market. For example, Japan Suzuki came to China to cooperate earlier, and took advantage of related policies and adopted the strategy of “studying two shipsâ€. At present, Changan Suzuki and Changhe Suzuki suffer from market share loss and unfavorable new car listings. Suzuki’s original leading edge is no longer there.
Before China's accession to the WTO, there are still people in the country who worry that India and Russia will replace China and become hot spots for multinational auto giants. Now, with China’s Great Wall Motors and other companies going to Russia to invest and build factories, some companies are ready to open up the Indian market. This fear no longer exists.
Therefore, the Indian automotive industry is unlikely to replace China in attracting investments from multinational auto giants, and may be only the "next" after the Chinese auto industry.
Comparison of relevant conditions of the Chinese and Indian automobile markets in the attached table
Related Indicators China India
30 cars per thousand people less than 10 cars
The automobile market growth rate is about 15% 8%
Economic growth rate of more than 10% 8%
The current annual sales of cars are 4 million cars 1 million
Multinational corporations in India purchase 5 billion U.S. dollars 1.5 billion U.S. dollars annually
The situation of multinational giants (middle) The basics have all come. They are "completed" (in India) and they are concentrated in several joint venture companies. The competition is not sufficient and they are "in progress."