Chennai : Beating Whole Asia Alone! - YouTube

India is a leading auto market

And if we talk statistically

Then in 2021, India was ranked 5th

In the list of the total number of car sales

And India is on the edge of getting ahead of Japan

But there is one more fascinating fact about the Indian auto market

In spite of India being ranked at fifth rank in the list of total car sales

But India is the 3rd largest manufacturer of automobiles

The reason behind this is

the manufacturing plants which are installed in India

Caters not only to India but the whole world

And some of the Indian states have contributed big to this cause

These states include Madhya Pradesh, Haryana, and Punjab

But there are two more states which have the largest contribution to auto productions

These two states are Maharashtra and Tamil Nadu

And Tamil Nadu has a bigger capacity compared to Maharashtra

Maharashtra has a total of 21 automobile factories

Tamil Nadu has 31 industries

In spite of Tamil Nadu having a huge surface area

Major plants of many brands are installed on the outskirts of Chennai

Which is the capital of Tamil Nadu

The outcome of this could be seen by searching Detroit of India on google

Almost every result would consist of Chennai

Not only this, if we search Detroit of Asia on Google

Now you would find two types of results

One including Chennai and the other with Thailand

In case you don't know, Detroit is an American city in the state of Michigan

And during some time, Detroit was the largest auto manufacturing hub in the whole world

According to many sources, Chennai alone has the capability of manufacturing 35 to 40% of the total automobile in India

which was even more earlier

It is also believed that 1 car is manufactured in Chennai Every 20 seconds

This video will help you in increasing your understanding of the Indian Auto industry

As we will start with the history of automobile manufacturing

And also understand what were its impacts in the market

And then we will understand how due to the presence of TVS, Ashok Leyland, Ford, and Hyundai

The number of good engineers increased manifolds in Chennai

That made Chennai the first choice of many international manufacturers

And in the end, we will understand

How one car is manufactured in Chennai every 20 seconds

Due to this Chennai is termed as Detroit of India

and many times Detroit of South East Asia

But first of all, we will understand the history of the Indian automotive industry

The first car on the Indian roads was seen in the year 1897

Which was imported to India and the owner was an Englishman

But Jamshed Ji Tata became the first Indian to own a car in the very next year

The first car was available in India before the 1900s

But till 1930 all the cars were imported to India from various countries

And no assembly plant was set up

And What was the need for the installation?

As these cars were only for the Britishers

And very selected among them too

But the scenario started to change in the 1940s

And Many Indian and International brands started capturing the Indian Auto market

Like in the year 1942, Hindustan Motors was launched

In 1944, Premiere motors were launched

And some American companies also entered the Indian market in this decade

Which included Ford, Dodge, etc

These companies sold their yield to some selective people only, for one decade

But in the year 1952, the first tariff board was constituted in India

And the board made a policy for the manufacturers which were only assembling the parts by importing them from other countries

Or were working without any Indian partner

Should close their operations soon

American Ford and GM were among these manufacturers

These two only had assembly plants in Mumbai

And therefore they decided to stop their operations in India

And now only two major players were left

Hindustan Motors and Premier Motors

Which were already in partnership with Morris Motors and Fiat respectively

Now if we look at the manufacturing

The manufacturing plants were distributed across several Indian states

Unlike today

During the 1950s to the 1960s, many new brands entered the Indian market

Out of these some companies were involved in the manufacturing of Two wheelers

Some in Trucks

And the rest in Tractors

The plant of Hindustan Motors was installed in Kolkata

Premier Motors was based in Mumbai

Mahindra and Mahindra were also in Mumbai

And Ideal Jawa Started from Mysore

But if we talk specifically about Chennai

The city came into the picture after the birth of Ashok Leyland in the year 1948

Ashok motors started its business by manufacturing medium and heavy commercial vehicles in partnership with British Leyland in 1948

It used to manufacture buses and trucks

Apart from this in the year 1955, Royal Enfield started its production plant in Chennai

In 1965, Heavy Vehicles factories were also installed in Chennai

Which used to manufacture Army Tanks and other articles for the Military

And along with all these the factories which used to manufacture tractors and farm equipment were also set up in Chennai during the 1960s

The plants of two car manufacturers were also installed in Chennai prior to the Indian Independence

which did not last for long

And last but not least

TVS installed its manufacturing plant in 1976 in Tamil Nadu

I found one thing in my research

That even in the mid-1960s Chennai was the lone region that had the manufacturing plants of four automotive brands

And the whole Tamil Nadu state had manufacturing plants of around 6-7 brands

The number of manufacturing plants in Chennai was more than the number of manufacturing plants when compared to any other Indian city or state

India did not face any changes in its automobile industry for a long time

And the reason behind this was the absence of permission for any automobile company to indulge in the business directly

But these things changed drastically after the market reform of 1991

In the year 1991, the market was reformed

And the Indian market was widely opened to the foreign companies

And after the liberalization, many car manufacturers entered the Indian market

Which also included brands from America, Japan, and Korea

Ford was the first foreign brand to enter the Indian market with a huge investment

Ford arrived with great expectations

And wanted to install plants on a large scale

And many Indian states were competing to attract Ford to get the investment

At that time there were very few jobs in India

And it was the first time when any foreign company had come to India with such a huge investment

This deal was captured by Tamil Nadu

And Ford installed its plant in Tamil Nadu in 1995

And it is believed that this become possible due to the formal Cheif minister of Tamil Nadu Mrs. J. Jayalalitha

In terms of investment, Ford was followed by the Korean Hyundai

And Hyundai was the first brand which started exporting cars manufactured in India

After Hyundai, various foreign brands like Mitsubishi, Nissan, Mercedes, BMW, and Yamaha knocked the doors of Chennai

And not only passenger vehicle brands

After some time heavy earth moving machines makers like the American Caterpillar, Japanese Komatsu, and Korean Doosan also chose Chennai

So, many brands chose Tamil Nadu over the other states as the destination for setting up their Manufacturing and assembly plants

Was the government of Tamil Nadu the sole reason behind this?

The government of Tamil Nadu formed an investment-friendly regime

Tamil Nadu was providing a good infrastructure

And also prepared supportive industrial policies and incentives

So that large-scale companies could be benefited

But all this was still not enough to attract so many foreign brands

Apart from the government policies, Chennai had many ports

and the residents had prior engineering skills

This was also a reason behind the selection of Tamil Nadu

If we talk about the engineering skills of the residents of Chennai

And we should talk about those brands which accepted Chennai as their manufacturing hub in the1960s itself

Like I told you earlier

These five brands started working in Chennai immediately after the independence of India

And due to this, the residents of Chennai were becoming skilled mechanics and engineers while the residents of other states only had theoretical knowledge

To fulfill the demand of the Industries, many engineering colleges were started in Tamil Nadu

And today Tamil Nadu has 934 engineering colleges

Which are the most among any Indian state

And this was the main reason behind the entering of many foreign brands into this state

Chennai also has sea ports

Due to this, it becomes very simple for the auto manufacturers to export their yield to other countries

Especially in Southeast Asia

Now we have understood, how Chennai has become the most prominent auto hub in India

Now I will share some facts and figures with you

This will give the necessary reasons for Chennai to be called the Detroit of India and Southeast Asia

The initial investment of Ford in Chennai was the biggest

But Ford did not last for long in the Indian market

And were forced to close their operations in India

But the brand which was followed by Ford in terms of Investments

Was Hyundai

And today Hyundai is the major player in the manufacturing systems of Chennai

The first export of Hyundai from India was done in the year 1999

20 cars were exported to Nepal

Hyundai exported around 1 lacs Cars from India till 2004 and 10 lacs cars till 2010

And till 2019, Hyundai has exported more than 30 lacs cars to other countries which were manufactured in Chennai

With this data, we can imply that the export of Hyundai cars from Chennai is huge

And so is the area covered by their plant

This was told by some officials of Hyundai that

The plant of Hyundai which is installed in Chennai is followed by their plant in the Korean city Ulsan

The plant of Hyundai which is situated in Ulsan is huge

And is considered as the 4th largest car Manufacturing plant in the whole world

And by this, we can predict the vastness of the plant of Hyundai situated in Chennai

The plant of Hyundai situated in Chennai has a capacity of 7 lacs units

The next big manufacturing plant situated in Chennai is owned by Renault-Nissan

Which have a capacity of 4.8 lacs cars

And Ford had the capacity of 2 lakh car units per year

The total capacity of installed large Vehicles in all the manufacturing plants based in Chennai is 2.18 lacs

And the two-wheelers brands have a capacity of 48 lakh per year for the installed vehicles

Due to this huge capacity

With certain assumptions, it is assumed that one car is Manufactured in Chennai every 20 seconds

Since the manufacturing of vehicles in Chennai is done in huge numbers

Chennai has an ample amount of automobile and automobile parts manufacturers

Tamil Nadu has around 100 top auto parts manufacturers

And around 350 tier 1 and tier 3 components suppliers

The components industry provides employment to more than 45,000 people in Chennai

Apart from Manufacturing, Chennai has R&D centers for various brands like Mahindra, Renault, Daimler, Hyundai, and Ashok Leyland

These were some reasons due to which Chennai is termed the Detroit of India

And sometimes Detroit of South East Asia

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