Nation on wheels! With or without Cash.

The Indian auto industry is expected to be the world’s third largest by 2018 only behind China and the US. (India is currently world’s second largest two-wheeler manufacturer).

The industry accounts for 7.1% of the country’s Gross Domestic Product (GDP). The Two Wheelers segment is the leader of the Indian Automobiles market with 79% market share owing to a growing middle class and a young population. Moreover, the companies growing interest in exploring the rural markets further aided the growth of the sector. The Passenger Vehicle (PV) segment has 14% market share.
It has been a year since the government demonetised Rs 1000 and Rs 500 notes and the auto-industry really had a bad impact by the demonetisation. If at all anything then demonetisation just stopped the growth of auto-industry temporarily but did not have any adverse impact. Before the government announced the ban of notes in November 2016, the sales of Passenger Vehicles grew by 11.02 percent in April-October 2016 over the same period in 2015.while the Commercial Vehicles segment registered a growth of 6.92 percent and Two-Wheeler sales were growing at about 16% during the financial year.

Post the announcement of demonetisation in India, the growth of passenger vehicles fell below double digit growth and the month of December 2016 saw cumulative automobile sales in India declining to lowest in 16 years but sale of passenger vehicles was still growing at 8.59% in April-December 2016 over the same period in 2015. Within the Passenger Vehicles, Passenger Cars, Utility Vehicles and Vans grew by 2.46 percent, 32.99 percent and 1.67 percent respectively during April-December 2016. Medium and Heavy Commercial Vehicles sales decline by 1.82 percent and two-wheeler sales were still strong posting 10% growth over sales in April-December 2015.
The month of December 2016 saw India’s top-three passenger vehicle and two-wheeler manufacturers posting decline in its sales.

Meanwhile India also witnessed exit of General Motors from India .

Demonetisation did not hurt the luxury car makers in India as much as the over 2.0L diesel engine ban in Delhi/NCR did or what the shift from BS-III to BS-IV did to the two-wheeler industry. “Three months into Demonetisation, and we can slowly see that the market is reviving with increased footfalls and customer enquiries,” commented N Raja, Senior Vice President, Sales & Marketing, Toyota Kirloskar. In fact two months into note ban, seven out of nine carmakers reported strong double-digit growth.
Yes! This move by government did slow down sales in the period November 2016 January 2017 and from February things were back on track and by the end of the financial year the automobile sales in India had crossed 3 million milestones and other than the exception of three-wheelers every segment had resulted positive growth. One can always want more sales and growth for more profitability but over all to the automobile Industry in India.

So what resulted in the growth?

To improve sales and customer experiences, auto dealerships have been introducing various schemes. On the spot discounts to customers and hefty incentives to company sales teams who convert inquires to sales and improve customer experiences.

The year 2016 – 17 also have seen some promising launches such as the Jeep Compass which has indeed turned tables for FCA India Automobiles resulting in multiplication of sales numbers by almost 10 folds. Models like Tiego , Tigor, Nexon  & Hexa from Tata Motors, The Ignis , Celerio and the new Desire from Maruthi Suzuki, New variants of Kwid and  Captur from Renault,  Wrv and the New City from Honda, The New Verna from Hyundai helped increasing overall sales during the year. Even in the two wheeler industry new models contributed to the overall growth with models such as The Activa 4G, Honda Navi, Jupiter Apache ,Victor & new Star city from TVS, Fascino,RayZr , Alfa and the new series of Fazer & Fz from Yamaha, Extensions of Pulsars, The Dominor from Bajaj .

The luxury auto makers contributed nothing less and the year 2017 witnessed one of the highest number of new car launches such as The New Tiguan, Passat from VW, Kodiaq from Skoda, The A5 & the S5 from Audi, The New GLA,GLS & the E class from Mercedes, The all-new 5 series from BMW, The LX, Ex  RX & ES series from Lexus, V90 Cross country from Volvo , The Maserati Levante, The Porsche 718 and even Ferrari joined the party with their GTC4 Lusso .

Overall the year looked Great and Auto lovers can expect lot more coming their way in 2018 too .


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