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India Cranks Out Small Cars for Export

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Washington DC October 6, 2008; The AIADA newsletter reported that annual passenger-car exports from India have jumped five-fold in the past five years.

Industry analysts predict exports over the next three years will surge nearly 300 percent to more than half-a-million vehicles a year according to the Wall Street Journal.

The export wave consists mainly of small cars built in local plants by Japanese and South Korean car makers, including Suzuki, Hyundai, and Nissan. Last month Hyundai added a midnight shift at its southern India plant to boost production 40 percent and meet booming demand for its i10 minicar abroad.

Both Hyundai and Suzuki unveiled subcompacts at the Paris auto show, targeting consumers in Europe, their main market for made-in-India exports. "Right now, India has everything - the local market, the quality, and the companies," says Shohei Kimura, managing director of Nissan Motor India.

But politics can still derail plans. India's Tata Motors last week decided to pull out of a new factory near Kolkata that was supposed to produce the Nano. It gave up on the site in response to violent protests demanding the return of part of the facilities' land to farmers.