The free-trade agreement (FTA) between India and the European Union is a huge opportunity for the Indian carmakers, especially in the small car segment in Europe.
Through this agreement, the Indian manufacturers will be able to manufacture vehicles at much lower prices than some European firms and thus have a competitive advantage in the European market.
Indian manufacturers have the potential to exploit this expanding market of small cars in Europe, and that is what Maruti Suzuki Chairman RC Bhargava highlighted.
Bhargava remarked, “We (Suzuki) have a manufacturing facility in Hungary, so we cannot compete with India on the same models with them. Of course, they (the Hungary unit) don’t make all the models, so we have to study the scope of the opportunity for small cars in Europe. But yes, there is a large enough small-car market in Europe. We in India have a cost advantage while European companies making.”
Also Read: India-EU Trade Deal Marks Major Shift in Global Trade Ties
It is assumed that this FTA can give the Indian manufacturers better access to the European markets, and it is also supposed to lower the tariffs on the cars made by Indians. With the trend in the European market of small vehicles that are fuel efficient, which has been on an increase, the manufacturers in India, whose production is cost-effective, are in the right position to increase their market share in the European market.
Other companies, such as Maruti Suzuki, which have lower production costs in India, may be able to give competitive prices, and they are a good choice among European clients. It is a major move that will see the automotive industry in India expand its presence in the international arena.
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