ASEAN and India Automobile Market
Analysis by Vehicle Type (2-Wheeler, 3-Wheeler, and 4-Wheeler); and by Fuel Type (Gasoline, Hybrid, and EV) – Supply & Demand Analysis & Opportunity Outlook 2021-2032
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Analysis by Vehicle Type (2-Wheeler, 3-Wheeler, and 4-Wheeler); and by Fuel Type (Gasoline, Hybrid, and EV) – Supply & Demand Analysis & Opportunity Outlook 2021-2032
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The ASEAN and India automobile market is estimated to garner a volume of 22,538.6 thousand units and 27,256.0 thousand units respectively by the end of 2032 by growing at a CAGR of 3.62% and 4.19% over the forecast period, i.e., 2022-2032. Further, the market generated a value of 15,316.9 thousand units and 17,486.8 thousand units respectively in the year 2021. The growth of the market can be attributed to the growing adoption of automobiles in both these regions. Both these regions have shown considerable potential for the expansion of the automotive industry owing to its diverse and quickly growing economies, high and steady GDP growth, dynamic demographics, rising levels of skilled labor, and high rates of urbanization. Hence, all of these elements have driven the use and sales of private vehicles in the area. For instance, the most developed automotive sector in ASEAN region is found in Thailand, which manufactured more than 2 million vehicles in 2018—a large number of which were exported to other nations.
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Further growing adoption of electric vehicles is also estimated to boost the growth of the market over the forecast period. This growth in adoption could be attributed by growing fuel prices and growing consumer preference for clean and green mobility. Also, compared to gasoline or diesel vehicles, electric vehicles have significantly lower emissions. Moreover, electric vehicles are more efficient than gasoline or diesel cars, which are able to transfer only about 16% to 20% of the energy contained in the fuel to the wheels. Whereas, electric vehicles could convert about 50% of the electrical energy from the grid to power the wheels. Additionally, as part of efforts to combat global climate change, the Indian government has launched initiatives on a number of fronts to reduce carbon emissions. Owing to their ability to reduce emissions and the depletion of natural resources, EVs are becoming more popular in India. The Indian government aims to achieve EV sales penetration for all commercial vehicles reach 70%, for private vehicles reach 30%, for buses to reach 40%, and for two- and three-wheelers to reach 80% by 2030. In keeping with the goal of achieving net zero carbon emissions by 2070.
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Base Year |
2021 |
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Forecast Year |
2022-2032 |
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ASEAN Market CAGR |
3.62% |
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India Market CAGR |
4.19% |
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ASEAN Base Year Market Volume (2021) |
15,316.9 Thousand Units |
|
India Base Year Market Volume (2021) |
17,486.8 Thousand Units |
|
ASEAN Forecast Year Market Volume (2032) |
22,538.6 Thousand Units |
|
India Forecast Year Market Volume (2032) |
27,256.0 Thousand Units |
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Regional Scope |
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Growth Drivers
Growing Urbanization
Over the next three decades, Asia—particularly China and India, but also Pakistan, Bangladesh, the Philippines, and Vietnam—would see an increase in its urban population of more than 60%.
Urbanization is expected to make automobile market flourish as it allows consumers who move to cities in search of better employment opportunities to have the wherewithal to purchase private transportation, which expands the market for the same. Hence this factor is estimated to growth of the market.
Surge in Sale of Commercial Vehicles
In the Asia-Pacific region, about 7 million vehicles were sold in 2021. This represents an increase over 2015, when more than 6 million vehicles were sold in the Asia-Pacific region.
Surge in Investment in Road Infrastructure
By 2022, the government expects to already have built 65,000 km of national highways for the price of Rs.5.35 lakh crore (USD 741.51 billion).
Government Policies to Support Automobile Manufacturing
The Nationally Determined Contribution (NDC) that the Government of Indonesia (GOI) submitted to the UNFCCC, which serves as the primary source document for Indonesia's GHG emission reduction strategies, makes an unconditional commitment to reduce GHG emissions by 29% below "business as usual" (BAU) levels by 2030, and up to 41% below BAU levels with international support.
Launch of Electric Vehicles
In India, Piaggio unveiled the Ape electric three-wheeler in November 2019. It is powered by cutting-edge Lithium-Ion Smart batteries.
Challenges
The ASEAN and India automobile market is segmented and analysed for demand and supply by vehicle type into 2-wheeler, 3-wheeler, and 4-wheeler. In the ASEAN automobile market, the 2-wheeler segment is anticipated to garner the largest volume of 18,544.8 thousand units by the end of 2032, growing with a CAGR of 3.77% over the forecast period. Further, the segment generated a volume of 12,409.5 thousand units in the year 2021. On the other hand, in India automobile market, the segment is projected to garner the largest volume of 21839.1 thousand units by the end of 2032, up from 13,447 thousand units in the year 2021. The growth of the segment can be attributed to the growing population of youth along with rising disposable income. Asia and the Pacific are home to more than 1.1 billion young people, or more than 25% of the world's population, who are between the ages of 15 and 29. 60% of the world's youth reside in Asia and the Pacific, making it the region with the youngest population. Further this growing youth population are expected to join workforces. Hence, with the rise of this youth population, which had discretionary income to spend on quality, luxury, and status symbols, the two-wheeler demand is expected to boost. Also, the two-wheeler industry has begun introducing new bike models which is further boosting the trend of two-wheelers among youth.
The ASEAN and India automobile market is also segmented and analyzed for demand and supply by fuel type into gasoline, hybrid, and EV. In ASEAN automobile market, the gasoline segment is anticipated to hold the largest volume of 9,985.0 thousand units by the end of 2032, as compared to other two segments. However, the volume is still lower than that of 2021, which was 11,883.6 thousand units for gasoline segment. In the market in India, the This decreased in the growth of the segment can be attributed to the growing demand for electric vehicles (EV), backed by growing concern for rising air pollution. About 90% of the 4 billion people who live in Asia and the Pacific are exposed to air pollution levels that are dangerous to their health. Hence, growing adoption of electric vehicles is estimated to improve urban air quality. Fully electric vehicles emit no carbon dioxide when driving since there is no tailpipe. As a result, air pollution is estimated to decrease. Just one electric vehicle on the road could reduce CO2 emissions by an average of about 1 million grams over the course of an entire year. Therefore, in the automobile market in ASEAN region, the EV segment is anticipated to grow at the highest CAGR of 26.44% over the forecast period, while in the market in India, the segment is expected to grow with the highest CAGR of 38.35% during the forecast period.
Our in-depth analysis of the ASEAN and India automobile market includes the following segments:
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By Vehicle Type |
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By Fuel Type |
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The Indonesia automobile market, amongst the market in all the other ASEAN regions, is projected to hold the largest volume of 9,341.0 thousand units by the end of 2032, up from a value of 6,243.1 thousand units in the year 2021. Growing adoption of e-vehicles, rising investment in automobile, and surge in youth population are some of the major factors estimated to boost the growth of the market in this country. Additionally, growing government initiatives in this region is also estimated to boost the demand for automotive in this country. A pilot project to convert motorbikes with internal combustion engines to electric motors has been initiated in Indonesia. Ten motorcycles have already been converted, and 90 more would do the same by November. The Indonesian government has set a target of having 2 million electric automobiles and 12 million electric motorbikes (including modified models) on the roads by 2030. However, the market in Vietnam is expected to growth with a largest CAGR of 4.09% over the forecast period.
In 2023, market players might incur losses due to huge gap in currency translation followed by contracting revenues, shrinking profit margins & cost pressure on logistics and supply chain.
Controlling Inflation has become the first priority for global economies from last quarter of 2022 and to be followed in 2023. With skewed economic situations, rise in interest rate by governments to control spending and inflation, spiked oil and gas prices, high inflation, geo-political issues including U.S. & China trade war, Russia-Ukraine conflict to intensify the global economic issues.
The interest rates in the U.S. may be less sensitive in 2023 as compared to 2022; sigh of relief for businesses. Positive business sentiments, healthy business balance sheets, growth in construction spending (private construction value in 2022 stood at $1,429.2 billion, 11.7 percent (±1.0 percent) above the $1,279.5 billion spent in 2021, Residential construction in 2022 was $899.1 billion, up by 13.3 percent (±2.1 percent) from $793.7 billion in 2021, non-residential construction touched $530.1 billion, 9.1 percent (±1.0 percent) above the $485.8 billion in 2021.) showcases minimal impact of recession in the country.
Similarly, spiked spending in the European and major Asia economics including, India, China & Japan to showcase less impact on the global demand.
Ans: The major factors driving the growth of the market are growing urbanization, surge in sale of commercial vehicles, surge in investment in road infrastructure, and others.
Ans: The market is anticipated to attain a CAGR of 3.62% and 4.19% respectively over the forecast period, i.e., 2022-2032
Ans: Uncertain government policies in some ASEAN countries, infrastructure, and fuel standards in ASEAN, and global semiconductor storage are some of the major factors estimated to hinder the growth of the market in this region.
Ans: The market in Indonesia is projected to hold the largest market value by the end of 2032 and provide more business opportunities in the future.
Ans: The major players in the market are Hyundai Motor Company, Mahindra & Mahindra Ltd., Kia India Pvt Limited, Honda Motor Co., Ltd., and more.
Ans: The company profiles are selected based on the revenues generated from the product segment, geographical presence of the company which determine the revenue generating capacity as well as the new products being launched into the market by the company.
Ans: The market is segmented by vehicle type, fuel type, and by region.
Ans: The 2-wheeler segment is anticipated to garner the largest market size by the end of 2032 in the market of both these regions and display significant growth opportunities.
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