Economic growth of any nation(either developing or developed) is mostlydependent on its key industry and its key resources .The automobile industry inour country has shown a constant and considerable growth and proven to be oneof the best ever growing and the prime movers of economic growthand major contributors towards the Gross Domestic Product (GDP) roughlyaround 7 % and due to rapid technologicalinnovation, there is tremendous growthin demand, and it generated huge employment in organized and unorganizedsegment Gottschalk and Kalmbach, 2007.
The recent decade is eyewitness of thesignificant growth of automobile sector of developed countries and latest trendsand innovations and better government policies open a new chapter in automobilesector for developing nation like India Choudhary and Goyal, 1997Dueto economic liberalization and government policies the automobile industry in indiahas shown a great market potential. Due to rapid technological changes and innovativedevelopment in the field of science and technology, particularly in communicationsand transport helps a lot to automobile industry .The government of India (GoI)has made tremendous changes like implementation of Goods and Services Tax (GST),E-Way bill, ban on BS-III vehicles to control pollution, Bharatmala project andgovernment’s ambitious plans for a mass scale shift to electric vehicles (EVs)by 2030.
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Government’s new and innovative policies give opportunities for overseas players to investments in thecountry. The Indian auto industry contributing around 6-8 % of world marketproducing around 2.6 Million unit’s .
The industry accounts roughly 7% of thecountry’s Gross Domestic Product (GDP). With around roughly 81 % of marketshare the two wheeler segment is the leader of the Indian automobile marketowing to a growing middle class and a young population. India is having a hugeand potential market in rural areas hence companies are taking interest and tryto explore the market in rural areas and further aided the growth of the sector.
Theoverall passenger vehicle (PV) segment has around roughly 13 % market share. Figure1 shows segment wise market share of automobile industry in India which showstotal production of automobiles in units (millions) year wise