Will China and India Enter the U.S. Auto Market? Analyzing New Emerging Market Auto Futures

Many of the analysts who look long-term at the North American auto market see chances for some new players to enter the arena, but a new report from GfK Customer Research North America, a New York-based subsidiary of the global GfK Group, is showing that newcomers might face significant challenges hawking their wares to North American customers.

Specifically, GfK’s Barometer of Automotive Awareness and Imagery Study mentions the possibility that Chinese and Indian manufacturers might have products appealing to some of the youngest American car buyers now surveying a market mostly dominated by domestic makers, the “big three” Japanese companies, and some outliers including German, Swedish and Korean brands. What the GfK study found, though, is that only one third of North American buyers surveyed said they would consider a vehicle purchase from one of these dark horse companies.

It makes sense that new offerings from China or India would face lots of obstacles on their way to American lots. Take the example of the Tata Nano, one of the most innovative small car designs from a major regional company that has bought a lot of global cachet by buying up not only the Land Rover marquee, but the renowned Jaguar brand, from Ford a few years ago. The Nano, which is being hailed as the “people’s car” due to its low cost of production and sticker price in India, boasts an astonishingly low price tag, and according to reviewers who have driven it, it doesn’t end up sacrificing as much as you might expect in terms of space and overall engineering. However, news from Tata has shown that the company would have to significantly re-engineer the vehicle to make it fit American road standards, which would push up the price from somewhere in the range of $2500 to more like $5000.

Although for now it still looks like a long shot, it makes sense for many American buyers, especially younger drivers and families, to keep looking at new options that might become available when companies from emerging markets start competing with the well-established auto makers who have dominated the market for decades. For many consumers, the overall goal is to get transportation as cheaply as possible, and along with good model pricing and financing research, knowing about the buyers full spectrum of options can help car shoppers make smarter decisions for their future on the road.