India had displaced Japan as the third largest in the pecking order in 2022. The two markets have now swapped the positions again. Light vehicles include all passenger vehicles, small commercial vehicles and vans less than 6 tonnes.
Tim Armstrong, who heads automotive planning solutions at S&P Global Mobility, attributes the trend reversal to the drying up of pent-up demand in India, rising interest rates and an increase in vehicle prices which has hit the entry-level car buyers hard.
In the same period, Japan saw sales advance 16% from a year earlier, on the back of strong pent-up demand and re-opening of the economy after the pandemic. Most of the other markets are also seeing strong pent-up demand, leading to high double-digit sales increase y-o-y, Armstrong told ET.
But sales in India are still growing at a healthy pace.
“Despite having grown over 20% in the last calendar year, India has still managed to grow in double digits in the first quarter, carrying forward the momentum. We expect it to again touch record sales of 4.7 million units in 2023, beating its own record of 2022 (4.4 million light vehicles),” said Paris-based Armstrong, who was in Mumbai last week for customer visits.
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