Most of the car-makers are gearing up for new launches in the upcoming festival season, in the hope of tiding over the Covid-driven slowdown.

At least half a dozen new vehicles are expected to be introduced over the next few months.

With the gradual relaxation of the lockdown across the country, car-makers reported decent volumes in July on a month-on-month basis, mainly driven by semi-urban and rural markets.

Of course, retail demand trends have been varied across States. While some reported improved year-on-year growth trend, States such as Kerala, Maharashtra and Tamil Nadu have been lagging.

But car-makers hope that the expected shift towards personal mobility will accelerate from the festival season. Maruti has seen a significant increase in demand for entry-level cars, at 65 per cent when compared with around 55 per cent earlier, as customers who want to own a vehicle for safety reasons generally look to this segment.

“The upcoming festival season would be critical to reviving consumer sentiment and one can expect most OEMs to target their new launches around that time to support volumes. We expect maximum new launches in the compact UV and crossover segments — in line with consumer preferences. Also, the share of diesel vehicles would decline sharply, in view of the cost implications for BS VI models,” said Subrata Ray, Group Vice President-Corporate Ratings, ICRA.

Hyundai has been exhibiting optimism in the market with the introduction of new models in the past few months. The company has also been receiving good response to its new models, indicating continuing buyer interests.

“Our July 2020 domestic sales volumes were about 98 per cent of July 2019 domestic sales volume, aided by new models such as SUV Creta and Verna as also compact SUV Venue,” pointed out Tarun Garg, Director (Sales, Marketing & Service), Hyundai Motor India Ltd.

UV launches

Meanwhile, companies like Kia Motors, Maruti and Tata Motors are lining up their new UV launches. While Maruti’s new petrol variant of S-Cross and Kia’s compact SUV Sonet will be introduced this week, Tata’s UV Gravitas is expected to be launched during the festival season. There will be a few new car introductions too.

Both Maruti and Kia would look to strengthen their position in the UV market with their new models. In volume terms, Maruti has seen a double-digit increase in UV sales in July 2020.

Tata Motors also appeared to have gathered momentum in sales helped by its compact SUV Nexon and its new sedan Altroz.

Industry analysts say July car sales are a sign towards expected normalisation. Car-makers may also increase their inventory for the upcoming festival season. Thus, wholesale numbers are likely to remain strong for the next few months in anticipation of continued improvement in retail trends. However, any further lockdown could postpone revival in vehicle sales.

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