BackIt’s raining discounts for car buyers this monsoon season
Car makers including Maruti Suzuki, Hyundai, Mahindra, Tata Motors and Ford are offering discounts across the range except newly launched, successful models
Premium
Car buyers in India could not have asked for more with every manufacturer doling out offers and discounts as they seek to woo shoppers at a time when they traditionally put off purchases because of rain and shraadh (a period when Hindus pay homage to their ancestors, and considered inauspicious for big-ticket purchases).
All models with the exception of newly launched successful ones have something or the other to lure buyers, indicating weakness in demand.
While offers are not unusual around this time of the year, discounts this July are higher than the previous year, said dealers of various auto companies.
Even as passenger vehicle sales in India have advanced for 12 consecutive months, mainly driven by newly launched sports utility vehicles (SUVs), car sales have hit the slow lane. Car sales dropped 5.18% in June, the second straight decline, according to the Society of Indian Automobile Manufacturers or Siam.
“There’s no buoyancy in the market and demand is being solely driven by new models," said R.S. Kalsi, executive director, sales and marketing, at Maruti Suzuki India Ltd. He attributed it to weak rural sales.
With the exception of three models—Vitara Brezza, Baleno and S-Cross—Maruti is offering benefits that include exchange and consumer offers across its line-up ranging from ₹ 20,000 to ₹ 70,000. But Kalsi is not worried and said the offers are “market-driven". “We can’t not offer anything when others are. We need to support our channel partners," he said.
Interestingly, this comes at a time when the local arm of the Japanese car maker is struggling to meet demand for some of its recently launched models. Kalsi said the company hopes to overcome the capacity issues by the second half of the current fiscal.
Maruti’s arch-rival Hyundai Motor India Ltd too is pulling out all stops to woo buyers. The firm is offering benefits ranging from ₹ 10,000 to ₹ 1.5 lakh.
“Consumer offers are the order of the day. Our models offer the best price-to-value equation," said Rakesh Srivastava, senior vice-president at Hyundai Motor India.
He added that the offers are an outcome of the recent shift one has seen in buyer preference—from cars to SUVs and from diesel to petrol models.
SUV market leader Mahindra and Mahindra Ltd, which has lately seen its dominance in the segment challenged by newcomers, is also offering attractive discounts ranging from ₹ 10,000 to ₹ 55,000 on most of its models, with the exception of XUV500. The offers, however, extend to new models such as the Nuvo Sport, TUV300 and KUV100. A dealer said the offers on Mahindra models have gone up by an average 5-10% from a year ago.
Meanwhile, Tata Motors Ltd, which has been riding on the success of its Tiago hatchback, has consumer benefit schemes running for all its models ranging from ₹ 35,000 to ₹ 65,000.
S.N Burman, vice-president, sales, at Tata Motors, said the offers have come down as compared to last year. “Our sales cost per car has come down," he said, without giving details. “The car market is on a de-growth path," he said, pointing out that only soft-road SUVs are selling.
Other manufacturers such as Ford India Pvt. Ltd, General Motors India Pvt. Ltd, Honda Cars Ltd and Renault India Pvt. Ltd are also offering benefits on sedans and compact cars as they come to grips with the changing preference of buyers.
“July is typically a weak month for car sales, but this time around, the demand has also been hit because of high interest rates and a lower growth in disposable income, which is the result of tepid growth in salaries, among other factors," said Mahantesh Sabarad, deputy head of research at SBI Cap Securities.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
