MG Motors' Hector SUV (Abhijit Bhatlekar/Mint)
MG Motors' Hector SUV (Abhijit Bhatlekar/Mint)

Opinion | Bright sparks in a dismal market

Amidst flagging sales all around, customers are queuing up for two new launches — Kia Motors' Seltos SUV and MG Motor India's Hector SUV

Who would have thought a couple of market entrants could light up India’s otherwise struggling car market? Amidst flagging sales all around, customers are queuing up for two new launches. Kia Motors, which has recently made an Indian market debut with its Seltos sport-utility vehicle (SUV), has received more than 6,000 bookings on the first day alone. Simultaneously, MG Motor India has had to stop accepting bookings in just about 20 days since opening them, having got over 21,000 orders for its first model available in the country, an SUV called Hector. The company, which has a production capacity of 2,000 units per month, has its hands full for the rest of 2019 at least.

The two SUVs offer unique internet-based features that connect the vehicles to smartphones and offer a slew of smart capabilities unseen so far in India. Sure, these must have contributed to the strong customer response. But are they the only reason? Their hot sales figures seem to belie the demand slowdown in the auto sector that has deepened in recent months. So could it be that the sector is turning a corner? Perhaps not. But it is a positive sign that should draw the attention not only of automakers, but also of policymakers.

For automakers, this should signal that customers are willing to spend if they have exciting products on offer. For policymakers, the lesson perhaps is that it may be too simplistic to attribute the industry’s woes solely to an economic slowdown. Maybe the current uncertainty over the future of fossil fuel-driven vehicles is also to blame. In the government’s enthusiasm for all-electric traffic in India, customers may have been deterred from buying cars. What if their vehicles get outdated? We hope that the buoyant booking figures are an early sign of a market revival. Nevertheless, it would help if the government spelt out its EV policy more clearly. The transition needs to follow a pragmatic timeline. Customer buy-in is crucial.