As the passenger car sales have been on a constant decline since the past few months, the slowdown has affected the demand for utility vehicles in India. However, the sales of new entrants like Ford EcoSport and Renault Duster have registered tremendous increase as compared to the same segment cars. While older warhorses like Mahindra Bolero, Scorpio and Toyota Fortuner are still performing well in the Indian car market.
According to data, Mahindra Bolero still continues to rule the SUV segment with sales figures reaching 50000 during the first half of 2013. The main reason attributed to this strong showing has been its resilience in rural areas where the car sells in high numbers and enjoys a good market share. Commenting on this development, Chief Executive of Mahindra & Mahindra, Pravin Shah said “Our models have additional duty, but they are holding on because of our strong semi-urban and rural presence.”
Talking about compact SUV, Ford EcoSport, it has considerably gone down well with Indian audiences as the company sold somewhere around 20000 units since its launch. Also to mention, the car has 50000 pending bookings till now and its waiting period has already stretched to 2014. On the other hand, EcoSport's rival, Renault Duster has registered a slight fall in the past months but the car is still ahead of Mahindra Scorpio. Whereas, the newly launched Terrano has got 7000 bookings since its launch in India. SUV manufacturers are primarily blaming the 3 per cent additional excise duty that has been imposed by the Indian government. The utility vehicle segment had grown by 52 per cent with total units accounting for 255896 units in the first half of 2012-2013 but in the current year, the sales have dropped by 4.8 per cent.
According to the data released by Society of Indian Automobile Manufacturers (SIAM), the car sales in India have decreased by 4.7 per cent in the first six months of the fiscal. This steep fall is the sharpest decline in half yearly sales since fiscal 2003 fiscal. Despite the slight 0.7 per cent sales increase in September 2013, the car industry might witness a second consecutive year of falling demand, which has been mainly fuelled by the high interest rates and increasing fuel costs. Commenting on this Vikram Kirloskar, President of Society of Indian Automobile Manufacturers (SIAM) was quoted as saying, "Whether we will catch up, it is a tough call. I will be thrilled if it is flat or a little bit plus."
The auto makers lobby had earlier predicted that the car sales are all likely to stay negative in the current financial year that shall end in March 2014. As the banks announced increment in interest rates in September 2013, the hopes of turnaround in the auto sector are fading away as the negative consumer sentiment has marred the scope of growth. Industry experts are saying that this year would not bring any cheer for car makers while 2014 looks promising enough.
