Entry-level vehicles ready for a grand ride as festivities begin

Vehicle makers, on their part, are drawing up aggressive plans with a focus on attractive discounts and new products to convert enquiries into sales. Manufacturers such as Maruti Suzuki, Hero Motocorp and Honda Motorcycle & Scooter India (HMSI) are betting big on the festive offtake, with expectations of more than half of the pent-up demand for entry-level two-wheelers and cars coming through during the festive season this year.

They say a significant percentage of the buyers, especially in the hatchback segment, are first-time buyers and many of them are in category B&C towns.

“For these buyers, a car purchase is a big milestone in their life journey and obviously they want to begin such milestones in an auspicious period,” said Shashank Srivastava, senior executive director at Maruti Suzuki. “Typically, festivals are occasions where families expect something to celebrate and bringing home a new car is certainly a celebration.”

Positive sentiment

While vehicle makers are lining up new products for launch during the season, banks are working on offers and incentives to attract customers as they see a surge in retail loans demand.

“We expect the momentum to build-up in the coming months on account of a combination of multiple factors, including a healthy growth in country’s GDP, a normal festive season after a gap of two years, better monsoon resulting in decent agricultural harvest and positive consumer sentiments,” said a Hero MotoCorp spokesperson.

The automobile market has recovered well from the Covid impact with the reopening of schools and offices. However, factors like compliance norms and rise in commodity and fuel prices have led to a rise in the cost of vehicle ownership.

This impacted the demand, especially in the entry-level segment of cars and was a significant contributor in the lacklustre sales performance of two-wheelers, said Atsushi Ogata, CEO at HMSI.

“With this in mind, we are approaching the festive season. While the season has certainly set the tone for us, we are positive that the coming months will bring in a balanced growth,” said Ogata.