All eyes are now trained on the festival season – beginning with Navratras in the northern part of India next month and going on to Diwali and beyond— for automobile sales to pick up. Not only are discounts —specially on petrol cars— at their peak right now, motown has lined up several new launches around the festival season.
Besides, even two-wheeler makers who have begun to witness a sales slowdown only now are also waiting for festivities to liquidate piled up inventories with dealers.
So perhaps now is a good time to buy that new petrol car, enquire about that bike you may have wanted for some time or simply check out the new launches.
On an average, discounts offered by Maruti Suzuki India on its petrol cars have increased by Rs 15,500 per car this quarter over the June quarter. If one were to compare them with what was being offered in the September quarter last year, discounts are up by 20-25%, say Jinesh Gandhi and Chirag Jain of Motilal Oswal. While this is largely due to the weakening demand for petrol cars across the country, Maruti’s inability to produce diesel cars at peak capacity due to the labour unrest at Manesar has also contributed to this state of affairs.
If you are a teacher, Maruti is offering upto Rs 62,000 off on the Alto and Estilo, Rs 64,000 on the Ritz petrol. Hyundai Motor India is offering Rs 44,000 worth of discounts on its i10, Rs 32,000 on the i20 and Rs 24,250 on the mini car Eon. Volswagen India has launched refreshed versions of its Polo hatchback and Vento sedan, adding more features and cutting prices on the top highline variants. The petrol Polo in highline spec will be Rs 40,000 cheaper while the top-end diesel Vento will save Rs 30,000.
Not just cars, two-wheeler maker Hero MotoCorp is also expecting sales to pick up in the festival season after having witnessed a slowdown in the past couple of months. “Going forward, I am personally very hopeful and pretty sure that from the month of October, when the festival season begins, we will see a positive push in the retail sales,” said Hero MotoCorp MD Pawan Munjal. Acknowledging that inventory levels with dealers were high, he said this was positive for the company. “I am glad to have pushed sufficient stock, which will be helpful ahead of the festival season.” In August, the company sold 10% fewer units to sell 443,801 units in the country.
Let’s talk about the new launches too. Renault is lifting the covers on the Scala sedan tomorrow, General Motors is slated to unveil the Sail hatchback later this month. A story on rediff.com speaks of Honda Siel Cars India launching a diesel variant of the Brio around Diwali but this could not be independently confirmed. But the most eagerly awaited launch could well be the new M800 that Maruti is expected to bring in, again by Diwali. Vendors have told us that this car will replace the Alto F8 version which the company has recently stopped manufacturing and could help Maruti regain some of its lost ground in the rural and semi-urban markets as well as with first time buyers.
But there could once again be a sting in the tail, as they say. New launches and discounts on existing models may not help automobile companies much if prices of petrol and diesel rise soon, as is being predicted. A SIAM fficial said that while any increase in diesel fuel price is a welcome move, any simultaneous increase in petrol prices will act as a deterrent for automobile sales, “If petrol prices are being increased by Rs 5, as reports suggest, the two-wheeler industry will be virtually killed,” he cautioned. Two-wheeler sales growth has already plateaued.
Also, continued high interest rates, high cost of operation of four-wheelers and other macro economic factors have led to a slowdown in sales of cars and two wheelers.