Chinese revving their engines for India

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Indian cars have yet to make their foray into the Chinese market but it seems Chinese cars are ready to enter in the Indian market. India has a heavily protected market with a few state owned players, much like the Chinese market. Suzuki have had a strong success in India with their small car range, so small car makers like JAC and Chery could have potential, but India also has a strong domestic truck market which will be quite resistant to any attempts from Chinese truck companies such as Foton.

From the Business Standard India:

With automobile boom here, vehicle makers to set base.

With India slated to become the fourth largest automobile market in the world over the next five years, a host of Chinese automobile manufacturers such as Jianghuai Automobile Company (JAC), Brilliance Auto, Chery international, Build Your Dreams (BYD) and Beiqi Foton are all exploring opportunities to set up shop in the country.

An industry source informed, “A lot of cross-pollination is going to happen between the automobile industries in India and China. Shanghai Automotive Industry Corporation (SAIC) has already made an entry into the market here and manufacturers such as Chery, Brilliance, JAC, BYD and Beiqi Foton are working out modalities to start operations. These companies have products which are a strategic fit for the Indian market. Some of them have already made enquiries regarding the vendor base available in India for starting operations here.”Emails sent to the companies did not elicit any response till the time of going to press.

The Indian automobile market increased by 30 per cent to register sales of 2.4 million vehicles in 2010.

According to a study by Booz & Company, the market here would more than double to produce six million vehicles by 2020.

Eyeing the growth potential in what is now the world’s second fastest automotive market, China’s largest exporter of passenger cars, Chery International, is understood to be evaluating prospects to enter the Indian market.

Brilliance Auto, which markets passenger cars under the ‘Brilliance’ brand and mini buses and cargo vans under the ‘Jinbei’ label, is also gearing up to make its foray here.

JAC makes passenger cars and recently launched an electric vehicle, Tong Yue, in the Chinese market.

China’s largest commercial vehicle manufacturer, Beiqi Foton, is considering setting up a facility in India shortly. Industry sources say it has already done a feasibility study.

The company has made enquiries regarding growth prospects in the Indian commercial vehicle industry and held talks with component manufacturers to determine the supplier base available for manufacturing vehicles locally. A final decision, however, has not been taken on whether the company would look at entering the country independently or through a joint venture.

Foton is likely to be the second Chinese automobile company to enter the Indian market after SAIC.

The latter, present through a partnership with General Motors in the Indian market, is working on introducing five new models in the country by 2013.