German Car Groups Welcome in Tough Indian Market

India is now the seventh largest auto producer worldwide.

Indian officials welcomed German auto and components companies on Sept. 21 to compete in one of the world's fastest growing markets but warned that Indian consumers and partners were no push-overs.

With an average age of 25 years, Indian consumers are educated, wealthier, demanding and "not loyal," said Wilfried Aulbur, vice-president of the Indo-German chamber of commerce. "It's a pretty difficult animal to handle," he concluded to laughter during a seminar on ways out of the automotive crisis at the Frankfurt motor show.

Aulbur, who is also managing director and chief executive of Mercedes-Benz India, said Indians had developed "confidence to compete on a global scale" and told German business leaders to get set for "very interesting discussions" on price and value.

India is home to the world's cheapest car, the $2,055 Tata Nano, and the country is also now the seventh largest auto producer worldwide, India's ambassador to Germany Sudhir Vyas said.

Essentially all major auto manufacturers have a presence there and car sales jumped by nearly a third in July, the sixth monthly rise running, owing in part to a cut in the excise duty on automobiles since December 2008.

German and Indian cooperation has grown steadily since Mercedes and Tata first teamed up around 40 years ago, and the Nano is laden with parts from 12 German suppliers, seminar moderator Bernhard Steinruecke noted.

The Nano "is a car of Indian vision and German technology," he said, adding that without the German companies' research and development, "this car would not be possible."

Copyright Agence France-Presse, 2009

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