When a new technology is introduced, it is always expensive but as time goes by price will drop and improvements will be made. Automatic cars were available in India for a long time, but we preferred manual transmission as automatic models were priced at a premium and not efficient also.
Globally, the popularity of automatic is increasing thanks to new technology. Finally India is also catching up with global trend as we are also moving towards automatic cars. In established markets like US and Japan, automatic cars share is 80-90 percent. Three years ago automatic cars accounted for just 5 percent of total sales in India but in 2018, it is more than 10-12 percent, which is a big improvement.
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To keep these models affordable for mass, manufacturer have introduced automatic models in middle variant rather than top end variant, which is key for the growth. Toyota recently introduced Yaris and they offer CVT transmission from base variant and more than 65 percent of bookings are for automatic models.
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The cars above 12 lakh all offer automatic models and 50 percent of buyers opt for it while in sub 12 lakh market, automatic models account for 12-14 percent. It will increase in coming years with the launch of more affordable automatic models. In SUV segment, people still prefer manual models but analyst expect this to change in coming years.
Mahindra and Tata have very few cars with automatic options, but the share of automatic models is 10-15 percent which is good and they are also working on more automated models. By the end of 2019, the automatic car sales volume is expected to touch half a million units from current 3.5-3.7 lakh units. The increase in popularity of automatic cars among customers will enable more new launches with two-pedal technology.
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