Small cars, big haul

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SummarySmall cars from India are making it big in European markets where people are moving from gas guzzlers to fuel-efficient cars and taking the scrappage incentives being doled out by various European governments.

Small cars from India are making it big in European markets where people are moving from gas guzzlers to fuel-efficient cars and taking the scrappage incentives being doled out by various European governments. The key growth markets include the UK, the Netherlands, Germany, Italy and Spain.

Moreover, global auto giants like Ford Motors, Toyota Motors, Renault and Nissan are making India a hub for overseas sales of small cars. Also the availability of cheap labour and a growing local market have in fact helped India to overtake China in auto exports and even assisted it to challenge Thailand and South Korea as an alternative production destination.

According to the Society of Indian Automobile Manufacturers (SIAM), the total export of small cars from India increased by 53% between April and September at 1,97,249 units as compared with 1,29,090 units during the corresponding period last year. Of the total exports, Hyundai Motor India (HMIL), the largest exporter of small cars from the country, sold 1,31, 744 cars during April to September this year and its nearest competitor Maruti Suzuki India exported 63, 140 units in the same period. Hyundai Motors exports i10 and i20 to European counties and Santro and Accent to non-European countries. Maruti Suzuki exports models like Alto, Zen Estilo and Ritz to South Africa, Australia, and New Zealand and A-star to the European market.

Considering that the April-September 2009 export numbers were simply encouraging, HMIL and MSIL are betting big on their new products and have even set up high growth targets for the current year.

While Hyundai Motor is expected to close 2009 (as the company follows the calendar year) with 2,80,000 units as against 2,44,000 units exported in 2008, an estimated growth of 14.8%, with robust demand for i10 and i20 in European countries, Maruti Suzuki is largely banking on A-star and expects to register close to 106% growth in 2009-10 with 1,30,000 units vis-a- vis over 70,000 units last year.

In fact, while Hyundai Motor is looking at exporting 1,00,000 units of i10 and another 80,000 units of i20 out of India, Maruti Suzuki is eyeing export of 1,00,000 units of A-star alone and that too when the market for small cars is really small and there are over dozen players, including Toyota, Honda, Nissan, Ford and Volkswagen, vying for bigger market share.

According to European Automobile Manufacturers Association, the total passenger car market in Europe is currently pegged at

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