Automobile sales are down and are going through the worst phase in the last one decade, but the demand for feature-rich vehicles are more than the entry-level models, according to manufacturers.

Companies like Maruti Suzuki India (MSIL) and Hyundai Motor India (HMIL) said they see more demand for mid-level or top-end models in each category of the vehicles.

“Overall, the hatchback percentages have come down in the last four-five years and there has been an increase in demand in the upper end of a segment of any brand. For example, the Alto VXi and VXi+ were at 46 per cent last year, which this year is about 54 per cent. Similarly, S-Presso VXi and VXi were at around 71 per cent last year and are now at around 73 per cent, slightly up…so there are some models which are doing great in the upper-end trims,” Shashank Srivastava, Senior Executive Director, Marketing and Sales, MSIL, told BusinessLine .

He said the gap has come in all categories of hatchbacks — whether entry level (like Alto, S-Presso) or mid hatch (like WagonR, Celerio) or premium hatch (like Baleno) — in the overall numbers.

The only segment that saw demand for even base (entry level) variants, is of the small or compact sports utility vehicles (SUVs) because of customers opting for the SUVs over any other segments.

“The SUV demand was at 11 per cent in 2017-18, went up to 11.2 per cent in 2018-19, 13 per cent in 2019-20, 16.4 per cent in 2020-21 and so far this year, it has already gone up to 21 per cent because of many new launches,” he said.

Shift to mid-levels

Similarly, Tarun Garg, Director (Sales, Marketing and Service), HMIL, said the demand is shifting from entry level cars to at least the mid-levels.

“This shows that the Indian customer is definitely evolving. Very clearly, they don’t want to compromise on the features in the new cars…even in the pre-owned cars space, they don’t want to compromise and they want to go for quality products,” he said.

Garg said the company does not have good traction for entry level cars like the Santro, but seeing good traction for cars starting from Nios to Aura to i20 or Venue and Creta in the premium categories.

One of the reasons why customers are opting for top-end trims is because manufacturers are launching products with high-end features and technologies, which the new-age customers want in their cars.

This was one of the reasons why Hyundai had launched a nationwide campaign called ‘Beyond Mobility’, reinstating the company’s global vision of ‘Progress for Humanity’— to help people understand and believe that tomorrow’s hyper connected automobiles will not only have advanced technology power to their core, but also have intuitive features, greatly enrich their lives.

Luxury cars

In the luxury cars segment, market leader Mercedes-Benz India is seeing good traction of its performance-based cars —the AMG series and increased its AMG portfolio this year — which is contributing a lot to its overall sales now.

“Mercedes-Benz sales volumes in the first three quarters of 2021 has already crossed last year’s volumes (7,893 units) and we are looking at a double-digit growth for the 2021 calendar year. We are positively optimistic for the fourth quarter, and will put in all the efforts to produce as many cars we can,” Martin Schwenk, MD and CEO, Mercedes-Benz India, said.

He said the only set back is that the supply remains an issue. But, “the overall positivity in the business environment, an uptick in economic activities combined with an updated product portfolio have spurred customer interest this festival season,” he added.

comment COMMENT NOW