November 6, 2025

Big news in the auto world! Toyota, Honda, and Suzuki are throwing their weight and money into India. Why? Because India is becoming the go-to place for car making. Toyota, the biggest carmaker worldwide, and Suzuki, India’s market leader with nearly 40% share, have announced a whopping $11 billion in investments to boost production and export power in India, the world’s third largest car market. Honda also jumped on the bandwagon last week, announcing it will make India a base to produce and export one of its planned electric cars. India's low costs and huge workforce have always been attractive, but now Japanese carmakers want to move away from China. Why? China is getting tough with a fierce price war among Chinese electric vehicle makers, making profits hard. Plus, Chinese carmakers are spreading overseas and stealing markets in Southeast Asia. "India is a good choice as a replacement market for China," says Julie Boote, an auto expert from London. She explains that in India, Japanese carmakers don’t have to fight heavy competition from Chinese electric vehicle makers who haven’t really entered India yet. Another big plus: India has improved its car-making quality and offers smart incentives thanks to Prime Minister Narendra Modi's government. Toyota and Suzuki mostly own their India units, while Honda owns 100% of its operations here. Japan’s investment in India’s transport sector soared more than seven times from 2021 to 2024, reaching 294 billion yen ($2 billion) last year. Meanwhile, investment in China’s transport dropped by 83% to 46 billion yen. Toyota is working closely with local Japanese and Indian suppliers to cut costs and ramp up production of hybrid car parts, which are in big demand. One Toyota supplier said, "It is no longer about global specifications but about local ones." Toyota plans to launch 15 new or refreshed car models in India by 2030 and expand their reach in rural areas. Their goal: to capture 10% of India's passenger car market, up from 8% now. Last year, Toyota revealed plans to invest over $3 billion to increase production at its existing southern India factory and set up a new plant in Maharashtra, expected to start by 2030. This will boost Toyota’s total production in India to over 1 million vehicles yearly. Prime Minister Modi’s government is all set to keep India growing at 8% economic growth by attracting foreign carmakers with incentives. In the last year, India made about 5 million passenger cars, selling most locally and exporting nearly 800,000. Limits on Chinese investment also help Japanese brands shield against Chinese competitors. "India's protectionist stance toward neighbouring countries is a blessing in disguise for Japanese carmakers," says Gaurav Vangaal from S&P Global Mobility. Meanwhile, local giants Tata Motors and Mahindra & Mahindra are making waves, grabbing market share from Suzuki. Before COVID-19, Suzuki had nearly half the passenger car market. Honda, known for its hugely successful two-wheelers in India, now wants to grow its four-wheeler business. CEO Toshihiro Mibe told the Japan Mobility Show that India is Honda’s second most important market for cars, after the U.S. Honda plans to produce and export one of its “Zero series” electric cars from India starting 2027. Suzuki’s $8 billion investment focuses on nearly doubling its production capacity to 4 million cars a year. Maruti Suzuki, its India unit, is the country’s top car seller and biggest exporter. President Toshihiro Suzuki said, "We would like to grow India as Suzuki's global production hub" and wants to boost exports. So the story is clear: Japan’s top carmakers are racing to make India their global car factory, leaving China behind. The Indian auto fiesta has just begun!

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Tags: Toyota, Honda, Suzuki, India manufacturing, Japanese Automakers, Auto industry,