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The maturing of Indian auto buyers

The maturing of Indian auto buyers
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First Published: Wed, May 30 2007. 09 57 AM IST

Updated: Wed, May 30 2007. 03 23 PM IST
No! We are not talking about delinquent drivers who still crowd Indian roads but the fact that buyers have now become quite savvy about the cars they buy. They expect world-class cars and will reject any model that lacks modern styling, fuel efficiency, reliability or decent service and spares.
They no longer think of a car as just a means of transport but are quite clued up about performance, ride and handling. Also, they no longer wait till their cars are weary with age and rust and will often change them even before the first set of tyres have worn out. But better tyres often last 50,000 kms or more.
The market is slowly shifting from smaller to bigger cars. The Maruti 800 used to have a 42% market share nine years ago. It is now down to just 7% last year while the sales of larger saloons in the same period increased from 17% to 27%. Many who had bought small cars replaced them with bigger ones and still bigger and better ones a few years later.
This awareness and the sheer size and fast growth of the Indian auto market has triggered a dizzy rush of new car launches. BMW inaugurated its new plant in March for their locally assembled 3 and 5 series of saloons. This was followed by the setting up of Fiat’s new plant, in collaboration with Tata Motors for the Palio Stilo and Renault’s new plant with Mahindra and Mahindra to make their Logan.
During this period Maruti launched their new Zen and more recently their SX4 saloon; Porsche introduced their new Cayenne SUV and Nissan launched their luxury Teana model. It was almost a launch a week. Nearly all the global majors are now in India and Nissan too will soon have a plant with Mahindra and Renault.
Among the smaller saloons old faithfuls like Ambassador, Esteem, Ikon, Accent and Lancer are being rapidly overtaken by bigger and more comfortable saloons like the Chevrolet Aveo, Mitsubishi Cedia, Honda City, Tata Indigo, Ford Fiesta and Verna which have sailed past many good older models like the Accent, Icon and Lancer while new entrants like the Renault-Mahindra Logan and Suzuki SX4 are accelerating rather smartly.
The market is very competitive and is keeping prices from rising and the new models are only expanding the market. Undoubtedly, these new saloons will have more powerful and efficient engines. People do not want raw power but are learning that small is no longer beautiful and that more powerful engines make driving easier with easy acceleration while overtaking and less shuffling of gears.
They also know that as bigger engines can drive smoothly in higher gear, they can actually use less fuel. Also, diesel mills are no longer the sluggish and noisy ones of the past. The new common rail diesels are peppy and quiet and economical too.
Electronics have made a big but subtle difference. Modern cars have more chips in them and engines work at optimum efficiency responding to heat, oxygen levels, road and load and do not stall at low speeds. The air-conditioning automatically controls the climate to the exact desirable temperature.
Steering and suspensions have sensors that improve driving control while brakes are much more efficient. Theatre lighting comes on as soon as the remote key is pressed and stays on till the ignition comes on. It stays on for 30 seconds after the engine is switched off to ensure that the occupants can safely get out of their cars.
Additionally, electronics play a role in passive and active safety. You will not immediately notice these electronic marvels but you will feel the difference between a new and an older car as soon as you start using one.
There is also a boom in the luxury segment with a younger generation of India’s affluent families no longer ashamed to flaunt the fact that they are actually quite rich. With more international business they need to impress foreign clients while successful NRI executives returning from top foreign jobs want cars comparable to the ones they were using in London or New York.
Resultantly, sales of more luxurious saloons like the Accord, Camry, Skoda Superb and Sonata that are in the Rs 16 to 22 lakh price range are showing healthy growth while the high end luxury models like the Mercedes in the price range of Rs 25 lakh to 1.5 crore is increasing rapidly with competition from the latest models from Audi, BMW, Porsche and others that sold over 4,000 cars last year.
There are a select few who want to buy super luxury cars like the Bentley, Maybach and Rolls-Royce that cost between Rs 1.5 to 3 crore each. Today there are over 30 imported luxury models available in India for those who can afford them. You can select from the range of Mercedes-Benz that has been assembling their petrol and diesel C Classe and E Classe saloons for almost a decade. They also offer their imported S-Classe and sporty CLS coupes as well as the M Classe SUV and SL and SLK sports cars.
Their great German rival BMW offers their locally assembled 3 and 5 Series with petrol and diesel engines as well as the imported 7 Series saloons and their new X5 SUV. The third among the German majors, Audi offers their smallest A4 saloon as well as a bigger A6 and a still bigger A8 as well as the Q7 SUV.
Porsche, a great name in sports cars, offer their small Boxter and a larger 911 Carrera and Cayman as well as the big and luxurious Cayenne SUV. A few who are more adventurous can also import a Ferrari or a Lamborghini. While in the SUV range there is the Toyota Prado, the Nissan X trail, The Honda CR V and the Mitsubishi Pagero.
Bentley offers the Arnage saloon, the Continental Silver Spur and a sporty Continental GT. The Rolls-Royce Phantom now owned by BMW and the Maybach owned by the Volkswagen/Audi group end the list of the ultra extravagant saloons.
While many in India continue to think that India is a poor country that can ill afford the extravagance of luxury cars, clearly, another vibrant young India with a global vision is fast emerging. They are open about making India world class, flaunting world class homes and world class cars.
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First Published: Wed, May 30 2007. 09 57 AM IST
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