India’s automotive landscape is undergoing a dramatic transformation as rising incomes and changing consumer preferences drive a surge in car ownership, particularly toward larger SUVs. Vehicle registrations have more than doubled in the past decade, with the number of cars increasing from 19 million in 2012 to 49 million in 2022, reports The Economist. Car ownership per 1,000 people has doubled, from 17 to 34.
This shift is most visible in Bangalore, India’s start-up hub, which recently surpassed Delhi to become the country’s most car-dense city. Despite notorious traffic congestion that reduces average speeds to just 18 kilometres per hour during rush hour, Bangalore adds a new car approximately every four minutes.
From hatchbacks to SUVs
SUVs now dominate new car sales, accounting for over 50% of purchases compared to just five years ago when hatchbacks held that position. Industry experts attribute this trend to both poor road conditions necessitating higher ground clearance and paradoxically, the expansion of India’s highway network, which has encouraged more long-distance travel.
Consumer preferences have also evolved beyond basic transportation needs. Safety features, once an afterthought, have become a key selling point since Tata Motors’ Nexon SUV earned a five-star safety rating. Additionally, buyers are increasingly prioritizing technology and comfort features over fuel efficiency, with the average car price rising by a third to 659,000 rupees ($5,800) in the past five years.
However, this automotive boom comes with challenges. Major cities like Bangalore struggle with inadequate infrastructure to support the growing vehicle population, leading to severe congestion. Despite these issues, industry experts expect India’s car culture to continue flourishing, driven by aspirational buyers who view car ownership as both a symbol of freedom and social status.