Mini hatchback automobiles and reasonably priced, non-electric bikes and scooters are set to register bumper gross sales within the coming months as India will get able to rejoice its first ‘regular’ festive season after a niche of two years. An “above regular” monsoon, optimistic shopper sentiment and a typically upbeat temper are additionally anticipated to push gross sales of entry-level autos.
Automobile makers, on their half, are drawing up aggressive plans with a concentrate on engaging reductions and new merchandise to transform enquiries into gross sales.
Producers comparable to Maruti Suzuki, Hero Motocorp and Honda Motorbike & Scooter India (HMSI) are betting large on the festive offtake, with expectations of greater than half of the pent-up demand for entry-level two-wheelers and automobiles coming via in the course of the festive season this yr.
They are saying a major proportion of the consumers, particularly within the hatchback section, are first-time consumers and plenty of of them are in class B&C cities.
“For these consumers, a automobile buy is a giant milestone of their life journey and clearly they wish to start such milestones in an auspicious interval,” stated Shashank Srivastava, senior govt director at Maruti Suzuki. “Usually, festivals are events the place households anticipate one thing to rejoice and bringing dwelling a brand new automobile is actually a celebration.”
Optimistic sentiment
Whereas automobile makers are lining up new merchandise for launch in the course of the season, banks, each private and non-private, are engaged on gives and incentives to draw clients as they see a surge in retail loans demand.
Can be good to have a banker’s quote right here, if doable
“We anticipate the momentum to build-up within the coming months on account of a mix of a number of components, together with a wholesome development in nation’s GDP, a standard festive season after a niche of two years, higher monsoon leading to first rate agricultural harvest and optimistic shopper sentiments,” stated a Hero MotoCorp spokesperson.
The car market has recovered properly from the Covid impression with the reopening of colleges and workplaces. Nevertheless, components like compliance norms and rise in commodity and gas costs have led to an increase in the price of possession for automobile clients.
This impacted the demand, particularly within the entry-level section of automobiles and was a major contributor within the lacklustre gross sales of two-wheelers, stated Atsushi Ogata, managing director, president & CEO at HMSI. “With this in thoughts, we’re approaching the festive season. Whereas the season has actually set the tone for us, we’re optimistic that the approaching months will usher in a balanced development,” stated Ogata.
Gross sales have been lagging for the entry-level automobiles within the current previous. However they registered a marginal year-on-year rise of 0.88% between April and August this yr, with Maruti Suzuki accounting for 90% of the gross sales. Maruti Suzuki sells Alto and S Presso on this section.
Pickup in enquiries
The entry-level motorbike section, the biggest contributor to complete motorbike gross sales, was led by Hero Motocorp with the gross sales of its Splendor and Deluxe rising 18% throughout this era, in accordance with newest SIAM information.
Sellers too anticipate to see enchancment in retail gross sales of entry-level bikes in the course of the festive season. “Footfalls and enquiries have picked up, however it’s but to translate into gross sales,” stated Nikunj Sanghi, proprietor of Rajasthan-based JS Fourwheel Motors, which has piled up stock of entry-level autos, as their provide remained constant whereas the demand had taken a beating.
Whereas festive season gross sales are anticipated to develop 10-15% during the last yr, they may nonetheless not attain the pre-Covid ranges any time quickly, two-wheeler sellers stated.
Though India’s per capita automobiles and two-wheelers has been rising steadily, there’s a massive room for development. In response to estimates from consultancy agency Jato Dynamics, India, with a family rely of 300 million, had 22.5 million automobiles in 2019-20, up 1.5% from 2016; and 149 million two-wheelers, a 12% enhance since 2016.
These segments are but to get saturated and there’s nonetheless lots of potential for development, stated Ravi Bhatia, president of Jato Dynamics.
