India to be Major New Market for US Companies in 2015

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by Sarah Wang
The success of already-established US businesses in India, such as McDonald's, have paved the way for new American entrants into the Indian market. Image: Flickr user Ryan.

 In 2015, India is set to welcome some well-known US companies into its domestic market – clothing retailer Gap, fast-food chain Wendy’s, and US automaker Jeep - highlighting its attractiveness to industries across the spectrum. Gap Inc. announced that it will open two stores in Mumbai and Delhi in 2015. With half of India’s population under 25 and high brand awareness already in the country, there is a huge market to be had in India as the stores will open just in time for Gap’s new summer collection. India will join the 50 other countries in which Gap operates, including Myanmar where the company recently became the first US retailer to establish manufacturing facilities. Gap Inc.’s home base of San Francisco has a sister city relationship with Bangalore, India and recently sent an Executive Mayoral Delegation there last November to discuss trade opportunities.

Clothing is not the only market that looks promising in India for American companies. In a partnership with Indian restaurant chain Sierra Nevada, US hamburger chain Wendy’s plans to open stores in India early in 2015. As the third largest US fast-food chain, Wendy’s is hoping to establish a solid foundation in India’s $2.4 billion restaurant service market with these new stores. Given that beef consumption in India is extremely low, to succeed Wendy’s will have to follow a path similar to McDonald’s which has enjoyed great success in India thanks to its adaptation of its menu to fit local tastes.

Furthermore, it was recently announced that Jeep will begin selling some of its models in India in 2015. There had been plans initially to introduce Jeep into the market in 2013 but that was delayed due to poor market conditions and the need to better localize the brand before launching into India. It is predicted that by 2020 India will be the world’s third largest auto market, with annual sales of over 6 million vehicles. With a strong network of dealerships already in place, Fiat Chrysler hopes to add 15 to 20 Jeep dealers by the time the brand launches there. Over the next few years there are also plans to begin manufacturing Jeeps in India at the Fiat plant in Ranjangaon, Pune, India.

 Sarah Batiuk is a Program Assistant at the East-West Center in Washington, DC.