Maruti Suzuki India Ltd, the country’s largest-selling carmaker, has revealed that more first-time car buyers have been flocking to the showrooms instead of those wishing to upgrade
With the entire auto industry came to a standstill last month, things have finally started looking better with most carmakers resuming production and reopening dealerships in the orange and green zone. Recently, the company has revealed that it is witnessing a greater interest by first-time car buyers instead of existing car owners wanting to upgrade to a better model.
Also, even though the company used to garner around 5,000 bookings a day before the nation went into lockdown on March 24, the reopening of select dealerships has led to a total of 6,000 bookings in a week’s time. In spite of the lower number of bookings made, the company feels it’s a positive trend as the bookings it is registering every day are on a rise. This is in line with the company’s hope of revived consumer interest. Maruti Suzuki has already taken several measures to ensure the safety of its staff and customers at the showrooms.
So far, the company has resumed operations at 1,150 showrooms and has already delivered over 3,000 vehicles. “Going by the trend of enquiries and the bookings, hatches seem to have increased in percentage. Almost 65 per cent of the enquiries are for hatches. The figure was about 55 per cent last year. I am not saying it is a trend–it is very early to say that. But this is the most definitive thing I can say at the moment,” said Shahshank Srivastava, Executive Director – Marketing & Sales, Maruti Suzuki India.
It might be a bit early to make any sort of sales forecasts but the company feels that in tough times like these, people tend to trust more established brands and this is something that could work in favour of the carmaker. Also, buying vehicles for their functionality will increase, which means there will be a higher number of people buying a car for their needs rather than a status symbol. As the number of first-time car buyers will be now higher, Maruti Suzuki, which sells many entry-level models, could end up benefitting.
Also, due to many people wanting to ditch public transport in favour of a private vehicle, there will be an increased sale of small cars. Another factor that will push the demand for small cars will be financing. As many new car buyers will have tighter budgets, they may want to settle for a lower-priced model instead of purchasing a bigger vehicle.
“These are logical trends backed by consumer interactions. But actually what will happen is to be seen since it has been a very short time since the reopening of the market. The average price at the showroom in the Indian market is about Rs 7.7 lakh, it has been going up for the last seven to eight years. For Maruti Suzuki the average would be around Rs 5.5-5.6 lakh or so,” Srivastava said.
Yet another trend that has emerged is the digitalization playing a higher role in the new car purchase. The company had earlier recognized as many as 28 touchpoints between a customer purchasing a car to taking its delivery. Out of these, as many as 21 have already become digital.
Also, as people are now sceptical about being outside their homes, there has been an increase in the number of online enquiries and bookings ever since the lockdown was relaxed to an extent earlier this month. Hence, most carmakers are even trying to digitize the finance part of the sales procedure. While there are some carmakers who are even providing a virtual look at the vehicle, most customers prefer actual test drives. Hence, the company is trying to work on digitalizing other points and make the car buying process even safer.