HSBC sees better prospects for global automakers’ India comeback

Global automakers that once struggled in India may find a better environment to make a comeback, according to Yogesh Aggarwal, Head of Research at HSBC India. He said past mistakes — like “trying to force-fit global products in India” instead of adapting them — could now be corrected.

Aggarwal noted that India’s auto market has shifted in multiple ways. Powertrains have evolved from pure petrol and diesel to electric and hybrid options, giving late entrants a “level playing field.” Cars are also larger and more expensive, with average prices doubling over the last decade to around ₹11–12 lakh. Safety has become a priority for buyers, and exports from India have grown, improving economic viability for smaller players.

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Market concentration, however, remains high. “Almost 94% of the market is captured by the top six OEMs,” Aggarwal said, adding that smaller players hold just 6% share. While regaining ground will be difficult, examples from other markets – such as Hyundai in the US and MG Motors in the UK – show that market share gains are possible.

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The demand outlook for 2025 remains muted. Aggarwal said the first quarter was weak, with only a “bit of a green shoot” in July. He expects flat to marginal growth this year, coming off a high base, but sees potential support from upcoming new launches. On penetration, he said India is “a story of market expansion” rather than low ownership, as most people who can afford a car already have one.

For the full interview, watch the accompanying video

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