Also, due to lower demand for trucks, only two manufacturers were allowed to operate in the country – Tata Motors in Mumbai and Ashok Leyland in Chennai.
The second wave started with the Japanese and American automotive giants in the mid 80s to the 90s. This was when Suzuki (with Maruti) and Ford Motor (with Mahindra & Mahindra) arrived in India.
Successive governments in Tamil Nadu ensured that Chennai did not lag behind in attracting automotive investments.
Apart from Ford India, the city today has South Korea's Hyundai Motor, Nissan-Renault, BMW and the Hero-Daimler's truck project. Of course, traditional players from here like Ashok Leyland, India's second largest truck maker, and the third largest two-wheeler company TVS Motors continue to flourish.
Dilip Chenoy, director general of Society of Indian Automobile Manufacture, contends that the entry of luxury car maker BMW in Chennai marks the beginning of the third wave of automotive investments in the country.
"Chennai has a historical relevance in the automotive industry in India. Component hubs first came to Chennai and then Royal Enfield and Ashok Leyland then Ashok Motors were set up. These investments acted as a tremendous catalyst for automotive industry to flourish in the country," he says.
Image: Norbert Reithofer, chairman of the executive board, BMW AG, poses at the assembly line of their production plant in Chennai | Photograph: Strdel/AFP/Getty Images
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