Special Story On Suvs Sales: The Road Of This Car Is Still A Road, And Before?: Special Story on SUVs Sales: Business sources say that during Vinayakachavithi… Rakshabandhan. Dussehra. Diwali. Navratri. Kartika month. SUV cars are sold like hotcakes during this festival season. Sales of sports utility vehicles and mid-size vehicles are reported to be strong. The data reveals that there is a huge demand for sales of entry-level cars as well.
This shows that business has been happy for all the car companies. However.. if you think of all this on one side, on the other hand.. despite a large number of pre-booking orders from dealers and customers, there is a situation where the companies are not able to deliver the vehicles. There are many reasons for this. In this background, let’s see whether SUVs will continue like this or if the headwind will blow.
The sub-compact sports utility vehicle segment in passenger vehicles has been growing rapidly in the last few years. But.. due to the latest and modern features, updates, and developments like bigger engines, the prices of top variants of entry-level SUVs are increasing. In the end, the mid-level SUVs are outpacing the rates.
Less than six years ago, Maruti Suzuki’s first SUV, the Vitara Brezza, attracted a lot of attention in the automobile market. The then MD and CEO of the company, Kenichi Ayukawa, also expressed happiness. If the Baleno model car of their company is mentioned as the poster of Make India, Vitara Brezzani said that they are giving a guarantee to Create in India.
As he said, the sales of Vitara Brezza in the Indian market have increased tremendously. After six years, now Brezza has come to the market with a new model… sunroof and 360-degree camera. In the last financial year, 6 lakh 65 thousand 216 SUVs were sold. This number is 5 times more than the entry-level SUVs sold in 2015-16.
With this, the segment share of SUVs in the passenger vehicle market has increased from 4 points 6 percent in the financial year 2016 to 21 points 7 percent in the financial year 2022. So far everything is going well. But.. the question arises whether the sales of entry-level SUVs will continue in the same range in the current financial year as well. It is worth noting that the opinions of market circles are also strengthening this doubt.
Ravi Bhatia, President of Jato Dynamics India, an automotive market research firm, said that the sales of SUVs may not be the same in the future due to various reasons. He said that the sales of SUVs, which achieved exceptional growth of 80 percent in the last financial year, will grow by only 33 percent this time. The reason for this is said to be the low number of new product launches.
He reminded me that only Hyundai Venue and New Brezza models are being launched. Even though the sales of sub-compact SUVs are increasing compared to mid-level SUVs, automakers are still a bit worried. However, Tata Motors is positive about the purchase of sub-compact SUVs.
Rajan Amba, Vice President of Passenger Vehicle Sales, Marketing, and Customer Care of the company stated that the share of SUVs in their overall portfolio will be more than 66 percent in the financial year 2023. Maruti Suzuki’s production of entry-level SUVs has been stalled for years. The company has taken this decision as it is switching from the old Vitara Brezza model to the new Brezza model.
Due to this the supply chain of Maruti Suzuki was damaged. Chip shortage also added to this. In August, the production of Brejas was increased to 15 thousand. After that, they decided to make 13 thousand to 15 thousand every month. Hence it will take at least 6 months to clear the existing pre-bookings. So.. Market sources said that the urgent waiting period for Breza is currently 5 to 6 months.
On the other hand.. Mahindra and Mahindra.. has opened bookings to sell 2 lakh 40 thousand units in the SUV segment. It is remarkable that there are five models of SUVs in total. Currently, Brezza model cars are equipped with a 1-point 5-liter petrol engine. Installing a more powerful engine will attract a 45 percent GST slab.
But.. only 28 percent GST is applicable for a sub-4 meter car. If it is fitted with a big engine, it will be taxed more as it will come under the big car category. Maruti Suzuki switched from a 1-point 3-liter diesel engine to a 1-point 5-liter petrol power mill before implementing BS6 emission norms. The prices of entry-level SUVs are surpassing the prices of mid-level SUVs if additional features are added as per the preferences of the consumers.
With this, customers are likely to gradually turn towards mid-level SUVs. Experts predict that the share of the SUV segment in the passenger vehicle market will soon increase as the tastes of customers are changing and companies are launching new models. However, if more sales growth is to be recorded in the Indian automobile market, it can be said that it depends on increasing the production of vehicles to meet the demand.
