Small cars get big at this year's Indian auto expo

Keen to boost sales, global automakers will unveil a slew of cheap, compact cars at India's Auto Expo next week as they turn to one of the few remaining growth markets to keep their engines humming.

Car sales in India, the world's second-most populous country, are set to jump about 16 per cent this year to 1.4 million vehicles, buoyed by robust economic growth and government incentives, in contrast to a slump in many developed markets.

That, and the abundance of important new models waiting to make their world premiere has industry insiders talking for the first time of a Delhi auto show that could rival or surpass the annual Detroit auto show in importance.

"The Indian auto industry and the Indian auto market have become internationally very important and therefore, no one can ignore this market," said Mahindra & Mahindra's automotive chief, Pawan Goenka, who is also the president of industry body Society of Indian Automobile Manufacturers.

"Even though the Detroit auto show immediately follows the Delhi auto show, there is full participation from all international companies and they are bringing in concept vehicles as well as launching new products."

The Auto Expo, held every other year in the capital city of New Delhi, first grabbed global headlines in 2008, when Tata Motors showcased its $2,500 (Dh9,180) Nano with the promise of bringing motorisation to the masses.

Next week's show will have no shortage of rivals – from Toyota Motor to General Motors – looking to debut their own compact cars as they seek a larger presence in one of the world's few healthy auto markets.

India is also expected to become a strategically crucial base for producing small cars for global automakers, many of which are looking to ship their cheap cars and components overseas.

Indian ratings agency Care has forecast domestic passenger car sales to rise 14.5 per cent annually to 2.4 million units in the fiscal year to March 2014, with growth led by small cars.

The US market is expected to total 10.4 million vehicles this year, the lowest tally since 1982. This year, China is due to surpass the US as the world's largest auto market with about 13 million vehicles sold.

The long-awaited unveiling of Toyota's compact car concept, code-named EFC for Entry Family Car, will be among the highlights at the Delhi show, which runs from January 5 to 11.

Toyota has not announced a price, but the model is due to become its cheapest offering, likely putting it well below $10,000.

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