The auto market in the emerging countries of China and India is growing rapidly. For example, in March of this year, GM sold more cars in China than in the U.S. Many of the major car makers of the world are investing heavily in these countries in order to gain market share.
Imitating the U.S. model, China and India are promoting the growth of the automobile industry. The Financial Times recently wrote:
China’s car-centred model of development has been a mainstay of economic growth in recent years…the spin-off benefits from burgeoning car sales have been enormous. Each car requires several thousand parts, hundreds - if not thousands - of suppliers, roads, car parks, driving schools, petrol stations and other service industries.
While auto companies are great for economic development, they are not the best when it comes to making profits. This is especially true for the big three US automakers. However the closely-related oil industry is the most profitable in the world. In 2009, seven of the top ten in the Global 500 rankings were oil companies. The Japanese automaker Toyota (NYSE:TM) was ranked at number 10. China’s very own oil major China Petroleum & Chemical Corporation (NYSE:SNP) was ranked ninth in the list.
An article titled Alan Mulally’s Asian Sales Call in Bloomberg BusinessWeek noted
ccording to market researcher J.D. Power & Associates (MHP), a third of the world’s auto sales will come from the region spanning China, India, Northeast Asia, Southeast Asia, Australia, and New Zealand.
The top car companies in China and India based on market share:
Source: Bloomberg BusinessWeek
It is interesting to see that German automaker Volkawagen (OTCPK:VLKAY) holds the largest market share in China followed by GM and Toyota (TM). Ford (NYSE:F) takes the 11th spot together with domestic car companies Geely and Faw. Compared to China, Indo-Japanese joint venture company company Maruti Suzuki holds the largest market share. Ford holds the eighth position.