The Indian automotive sector has confronted robust occasions however is displaying indicators of restoration, transferring in direction of the pre-pandemic ranges of gross sales quantity. Despite non permanent setbacks like hovering crude costs, semiconductor scarcity and provide chain disruptions, the sector has exhibited resilience. Backed by supportive insurance policies such because the Automotive Mission Plan 2026, scrappage coverage and the Production-Linked Incentive scheme, the auto sector is predicted to indicate progress.
Certain developments have been sweeping the sector, comparable to digitalisation, direct gross sales, elevated concentrate on buyer expertise, elevated car connectivity, new powertrains like hybrid and electrical, rising demand for CNG autos, and so on.
There can also be elevated buyer desire in direction of sport utility autos (SUVs); the SUV section has grow to be fragmented, and compact SUVs are main this fragmentation by way of volumes and market share. It is predicted that SUV gross sales will develop at a CAGR of 9 per cent over the following seven years and exceed 2.16 million models by 2028.
Buyers want compact SUVs as a result of these provide upright driving stance and excessive floor clearance, making these extra appropriate to drive than different physique sorts on Indian highway situations. But probably the most vital issue is the worth level—compact SUVs are priced in the identical vary as some premium hatchbacks and sedans, and provide good trip, consolation and highway presence.
Compact SUVs have grow to be the biggest section inside the passenger car (PV) house, constituting nearly 22 per cent gross sales share, from a meagre 5 per cent in FY16. The compact SUV section has overtaken the premium hatchback section, which was the biggest at round 24 per cent of the market in FY21, however got here all the way down to 21 per cent in FY22. Noticeably, the general SUV section has grown from about 17 per cent of the market in FY16 to nearly 40 per cent in FY22.
Buyers have additionally developed and grow to be extra prosperous and youthful, and their aspirational wants have grow to be bespoke by way of the worth proposition they search. At current, nearly 50 per cent consumers on this class are lower than 35 years of age. Other developments the compact SUV section has witnessed embody a shift within the desire in direction of petrol. In FY16, nearly 80 per cent compact SUVs offered have been diesel and 20 per cent petrol. Now, 79 per cent gross sales are of petrol and 21 per cent of diesel.
In FY22, as many as 664,000 compact SUVs have been offered, and these made total SUVs a much bigger section than total hatchback vehicles—the general SUV section has grown from 32 per cent of the PV house in FY21 to 40 per cent in FY22, whereas the general hatchback section has lowered from 45 per cent to about 38 per cent throughout the identical time.
As per demographic profiling, the brand new breed of shopper is from metropolitan markets (tier-1 and tier-2 cities), is wise, progressive and fashionable, is within the 25-35 12 months age group, and is both a first-time purchaser or is looking for an improve from hatchbacks. This new breed of buyer is aspirational, earns round Rs 80-90,000 monthly, and is both salaried particular person or small- to mid-level businessperson.
There can also be a shift within the shopping for standards, which till not too long ago was extra centered on design, model and mileage. That is now altering, with clients specializing in expertise, options, ergonomics and performance. Also, design components that juxtapose sophistication, class and paramount security are key elements influencing purchaser behaviour.
It is obvious that SUVs have gotten the car of selection throughout shopper courses, demographics and geographies, finally representing a profitable enterprise potential for producers. We, at Maruti Suzuki, will quickly introduce a number of SUVs throughout segments to match the altering aspirations of Indian clients.
The creator is senior govt director, Marketing & Sales, Maruti Suzuki India Ltd
Twitter: @ShashankDrives
Source: www.financialexpress.com”