ORIX Corporation India Ltd, a major provider of mobility solutions and financial services, anticipates that the automobile leasing sector in India will increase from its present 2% to 7-8% of overall vehicle sales within the next 5-7 years, driven by a generational change in consumer preferences. “We will be lucky if this 2% becomes 7 or 8% in the next 5-7 years. That’s the way we are looking at it,” said Vivek Wadhera, Managing Director and CEO of ORIX India.
At present, sales of passenger vehicles in India reach 43 lakh units each year. Still, leasing represents only 1-2%, which is considerably behind markets such as the US, Japan, and China, where leasing makes up 30-40% of vehicle sales. Wadhera highlights this disparity to cultural preferences, noting, “Indians still like to buy vehicles, and hence only 1-2% of the total automobile sales that happens through leasing or subscription.”
However, the younger generation is driving change, opting for rentals over ownership and prioritizing experience and travel. This generational shift mirrors trends in the real estate sector, Wadhera added.
ORIX India, which has partnerships with OEMs like Maruti Suzuki and Kia for vehicle subscriptions, also reported strong business momentum. “This year will be 30-35% higher than last year all the businesses put together. We made a profit of USD 12 million last year in India. This year, we should be making USD 16-18 million profit,” Wadhera mentioned.
As interest in self-drive rentals, leasing, and financial services continues to rise, ORIX India is strategically situated to take advantage of these new trends.
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