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Course: Expected Questions Geo-Mains Paper GS- 1 Presented by Ashna Sisodia
Question 42 It is said that the auto industry is looking beyond ownership model. Elaborate and analyze the growth trend of auto industry in India and around the world. (200Words)
Answer In ownership model, every person buys an asset and uses that asset for personal gains. For example, owning a car and using it whenever one needs to travel. Such a model in car industry is popular for last 45 decades in all countries esp. in developing countries for past 2 decades. 1. But with increasing problem of parking space, population, pollution & increasing migration of people b/w cities or towns, there has been a decreasing trend in buying a car, esp. in developed countries. 2. Now, many people prefer alternatives to owning a car like, rental cabs, rental cars for long period, carpooling, pickup and drop cars etc. Auto industry has also noticed such a trend and is starting to provide rental cars in place of owning a car, for example, Ford's Go Drive car sharing service.
3. High Cost of Owning a vehicle Renting a car service is relatively cheaper than owning a car which comes with many externalities. 4. Tourism Renting services gives seamless options to tourists to plan their visits and thereby , increase in tourism will be beneficial for this sector. Point to be noted is such a trend is popular in developed countries. But in developing countries like in India, still owning a car is popular because of emerging middleclass and car is seen as a luxurious asset. Focus of Auto industry for India is still to make cheap and high mileage cars. But this will not work for long term growth because of rising population, migration and again no parking space
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