Rise of the millennial population, increasing disposable income and availability of innovative mobility solutions will drive the market.
Passenger
vehicle (PV) and two-wheeler
sales in the country have been bleak in the past few months,
despite inquiries being good, due to poor consumer sentiment. To
create excitement among consumers, especially during festivals, car
manufacturers have lined up around 25-30 launches and two-wheeler
makers have lined up another 20 between August 2019 and March 2020.
The new launches include electric and hybrid vehicles.
On
an average, car makers, excluding luxury ones, invest around Rs
1,500-2,000 crore to launch a new car.
Two-wheeler
and PV retail sales dropped by five per cent and 4.6 per cent,
respectively, in June 2019, compared to last year.
CARE
Ratings says that demand might remain muted till the second quarter
before it starts picking up from the third quarter due to festival
and pre-buying before BS-VI implementation from April 1, 2020. Also,
with higher MSPs announced, farm income is expected to be marginally
higher and encourage rural spending.
To
cash in on this, car makers have lined up nearly 25-30 new launches.
Some of them include Maruti Suzuki Ertiga Cross and S-Presso, Hyundai
New Grand i10, Tucson Facelift and Hyundai New Elite i20. Honda would
be launching Honda HR-V and New City, while Tata would introduce the
Buzzard and Altroz. Skoda expects to launch Karoq, and Renault to
launch Renault Triber and Kwid Facelift.
Vikas
Jain, national sales head, Hyundai
Motor India Ltd, said that sometimes, a slowdown in the market is
a cyclical phenomenon. Due to practical challenges such as volatility
in fuel prices, high interest rates and increase in insurance
premium, some of the buyers are deferring their purchase decision.
The
long-term outlook is good considering that the penetration of PVs in
India is still very low at around 20 out of 1,000 people. The rise of
the young millennial population, increasing disposable income and
availability of innovative mobility solutions will drive the market.
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