Maruti Ertiga, Swift Dzire and Mahindra XUV 500 remain unfazed amidst the turbulence
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Maruti Suzuki Ertiga, Swift Dzire and Mahindra XUV 500 have been successfully defying the gravity of the downward slope in the automotive industry of India to enjoy unmatchable success. This can be mainly attributed to their affordable price tags, coupled with better mileage and convenience that is typical of Utility Vehicles (UVs). They make up an interesting success story especially, when majority of the auto dealers in the market have been offering massive discounts on their cars to attract customers in wake of the sluggish market.
The aforementioned cars have been performing well and are in demand, especially their diesel variants despite the slowdown in the market. To be precise, these cars have been commanding a waiting period of three to six months and the customers are willing to comply as well. In contrast, other leading manufacturers of diesel cars have been adjusting their production capacity to manage the inventories.
A senior analyst in Asian Market Securities, Abhishek Banerjee, said, “Vehicles like Mahindra’s XUV 500, Maruti Suzuki’s Ertiga, DZire has fetched good volumes for the companies. In the passenger vehicle segment, it is very clear that the new products are influencing the market dynamics.”
Ertiga, the first Multi Purpose Vehicle (MPV) in Maruti Suzuki's portfolio, was launched in April 2012 in the country with a starting price tag of Rs. 5.89 lacs. The new car brought home the title of third largest UV maker for its manufacturer within two months of its launch, which is quite a feat for a new launch. It has already sold 17,700 units since its release and now the company is planning to sell 70,000 Ertigas a year. The sales volume of Swift Dzire was not far behind with a five fold growth to 13,741 units in June, 2012. This growth, which was mainly due to its diesel variant, is a significant advantage over 2,486 units sold in the same month of 2011.
XUV 500, a compact Sports Utility Vehicle (SUV) from the stables of Mahindra & Mahindra (M&M) bagged 9,200 bookings since its national launch. The SUV comes with an attractive initial price tag of Rs. 11.5 lacs, for a car of its calibre. XUV 500 enjoyed popularity of such magnitude that its nine month production stock was sold within a period of just a month since its launch. This led M&M to take a decision regarding the monthly production capacity of the new SUV, which will now be increased to 5,000 units by September-October.
Senior Director, Automotive Practice, Frost And Sullivan, V.G. Ramakrishnan, said, “The XUV 500′s design is good and pricing a killer…it’s the only SUV at that price point. With that pricing you bought in a new set of customers who wanted to buy into a new segment.”
However, other car manufacturers are catching up fast with Renault India launching its Duster, a mid-size SUV with competitive price tags ranging between Rs. 7.19-11.29 lacs across its different variants. Ford Motors is also gearing up to launch its EcoSport to square off against Ertiga and Toyota Innova. An affordable UV is in pipeline from Nissan, to be launched later in 2012. All of these car makers are aiming at a larger share of the fast growing UV market in India. The widening gap in the prices of diesel and petrol is the major reason behind the shift of market sentiment towards diesel-run SUVs. It would be interesting to watch how the industry turns out once the new launches have made their début.
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