KOLKATA, India, Sept. 19 (Xinhua) -- After the U.S. and China, by 2018, India is likely to become the third largest car manufacturer in the world as the European car market is shrinking and there is a shift in manufacturing in emerging economies, a top official of PwC said Wednesday.
By the end of last year, India was fifth after South Korea, Germany, Japan and China.
Felix Kuhnert, Partner at PwC and the Automotive Industry Leader for Europe, said registration numbers for the fifth year have declined in Europe and pointed out apart from the German firms, most carmakers in the region are finding it hard to post growth.The BRIC nations, along with recovery of the U.S. and Japanese markets, are expected to be "saviours" of the global car industry, which is slated to grow to 79 million units this year (from 74 million last year).
Kunhert said, "In Europe, the capacity utilisation is significantly below the average industry average of 75 per cent. The market cannot grow there because the demographics are such that the population is declining.
"The scrappage schemes announced a few years back had sucked a lot of demand out, because of which today customers are not buying cars," he added.
He felt that though Europe may see growth from next year, reaching the 2007 production of 19 million units will prove elusive, as in 2011, only about 16 million cars were made in Europe.
From next year India is unlikely to face any problem regarding car export.Kuhnert said that North-western Europe (the U.K., France and Germany) were expected see an improvement in small car demand from next year, though southern countries such as Spain and Italy would take longer to turnaround.
Europe is the biggest destination for Indian made small cars. Renault-Nissan and Hyundai export about half their production from India, while Indian car market leader Maruti Suzuki also supplies significant numbers overseas.