India’s automobile sector has witnessed an extraordinary transformation — evolving from a modest 2 million vehicles in the early 1990s to a whopping 28 million by 2024–25. This three-decade-long journey reflects technological advancements, policy shifts, rising middle-class aspirations, and India’s growing global economic clout.

The 1990s: Liberalization and the Entry of Global Brands

Before 1991, the Indian auto industry was tightly regulated, with limited models, long waiting periods, and little innovation. The economic liberalization opened the floodgates:

Major entries: Maruti-Suzuki, Hyundai, Honda, and Tata Motors began revolutionizing affordability and design.

Production numbers: Around 2 million vehicles annually, mostly comprising two-wheelers and compact cars.

Key models: Maruti 800, Tata Sierra, and the first-generation Hyundai Santro.

2000–2010: Growth Fueled by Demand and Infrastructure

This decade marked a shift from functional transport to aspirational buying:

Market demand: Rapid urbanization and rising incomes fueled demand for cars and bikes.

Milestones:In 2005, India became the second-largest two-wheeler market globally.

Introduction of Tata Nano, the world's cheapest car.

Annual production: Surged to ~10 million units.

2010–2020: India Goes Global

• Exports boom: India began exporting compact cars and bikes to Europe, Africa, and Latin America.
• Investment surge: Global players like Ford, Volkswagen, and Renault expanded production bases in India.
• Annual vehicle production: Crossed 25 million units in 2019.
• Electric mobility: Entry of e-rickshaws and models like the Mahindra e2o marked the start of India’s EV shift.

2020–2025: Electrification and Green Mobility

FY 2025 production estimate: ~28 million units across all segments (SIAM data).

EV penetration:

• Electric two-wheelers: Over 1 million units sold in FY25.
• Electric cars/SUVs: Touched 1.5 lakh+ units.

Policy support:

• FAME-II subsidies, PLI schemes, and state EV policies accelerated EV adoption.

Sustainable manufacturing: Leading brands like Tata, Hyundai, and Mahindra have incorporated solar energy and carbon neutrality into plant operations.

Real Numbers Snapshot (FY2024–25)

Two-Wheelers:

• Production (Approx.) – 18 million+
• Leading Brands – Hero MotoCorp, TVS, Bajaj

Passenger Cars:

• Production (Approx.) – 4 million+
• Leading Brands – Maruti Suzuki, Hyundai, Tata

Commercial Vehicles:

• Production (Approx.) – 1.1 million+
• Leading Brands – Ashok Leyland, Tata, Mahindra

Three-Wheelers:

• Production (Approx.) – 1.2 million+
• Leading Brands – Piaggio, Mahindra, Bajaj

Electric Vehicles (All):

• Production (Approx.) – 1.6 million+
• Leading Brands – Ola Electric, Tata, Ather

Competitors and Global Standing

India’s rank globally:

• 3rd largest car market (surpassing Japan in 2022).
• Largest two-wheeler market.

Key competitors: China, USA, Japan, Germany.

Strength: Cost-efficient engineering, compact car design, large domestic demand.

Conclusion

India’s automobile sector has come a long way — from producing just 2 million vehicles to standing shoulder-to-shoulder with global giants. With the ongoing push for green mobility, localized production, and a massive talent pool, India’s next automotive revolution is already underway.