Tamil Nadu   

Luxury car market is revving up

On the fast track

Stand on any rooftop in the city and the cavalcade of vehicles on the road will leave you awestruck. Lay your bet on any brand, any model and surely you will not lose.

From BMW to Mercedes Benz, Audi and Porsche to Ford Endeavour , Mitsubishi Pajero or Honda CRV, you will be able to spot these models. That is because the skyline of automobile industry – be it in happening metros or low key towns – is tod ay dotted with a profusion of names.

Madurai and all other small cities and towns in Southern Tamil Nadu are no exception. From scooters to luxury wheels has become the storyline of most car owners even in semi- urban and rural India.

Cars may still be considered a luxury here but quite dubiously it is a luxury which a growing number of people are now able to afford.

“The Indian automotive market seems to be firing on all cylinders and it is growing like never before," declares N.A.Charles, GM(Operations) ARAS Motors.

Apparently while the small cars are registering a growth rate of 17 per cent a year in terms of sales, it is the luxury car segment that is racing in top gear with 28 per cent growth rate. Of the 20 new models expected to be launched during the year, several are luxury models.

Mr.Charles feels in the overall growing market, the SUVs (Sports Utility Vehicles) will contribute about 20 per cent. The General Motors never let its interest in the SUV segment wane, which has witnessed a slow but steady growth. The company is unveiling its new mid-size cross over SUV, the Chevrolet Captiva, at the ongoing Auto-expo in Delhi.

“There are not many true SUVs in the market. Some previous models have failed to penetrate. Our good looking SUV has the brand name and is a step ahead than those available in the market now,” says Mr.Charles.

Captiva has been well received abroad for its styling performance, user-friendly functionality, ride and handling and safety. Mr.Charles is quite sure that the Captiva will “captivate professional young bosses in the city and adjoining areas in the age group of 28 to 40”. He attributes the growth of car industry to the rising disposable incomes, a changing lifestyle and foreign travel of the upwardly mobile globetrotters.

But Chevrolet Captiva may have a formidable line up to compete against. Ford’s “new” Endeavour, the Honda CRV, Hyundai’s Tucson and Suzuki’s Grand Vitara will ensure that there is a battle for who is to be seen most or more in the coming months.

Opines N.Suresh, AGM (Sales) Akshaya Ford: “Fuel efficiency and price tags are no longer the main deciding factors for the buyer. Design and appeal in addition to a brand are the strongest drivers in the luxury segments.

The first thing that people like about a car is the look.”

“It is too early to assess the market demand since the SUV segment is still evolving here. Till sometime back, the SUV segment barely existed in the domestic automobile market, but today the scenario has altered,” he says.

Though not all the models that have been launched in India over the last decade, are the “real SUVs”, every car manufacturer has an impulsive need to mark a presence in every segment. “The business in luxury end products is not measured in terms of volumes but the brand tag and a sense of pride that a customer holds,” adds Mr.Suresh, revealing that at least 10 SUVs move out of the showrooms every month in Southern Tamil Nadu.

“Competition in this segment is largely based on brand name, product quality, after sale service, resale value and dealer-customer relationship,” echoes Mr.Suresh of Sundaram Honda.

Ever since the launch of the completely imported from Japan, the Honda CRV model worth Rs.20 lakhs, 24 cars have been sold in the last seven months in this region. “Orders are based on bookings only,” says Mr.Suresh.

“Pay more money and get more safety is what people go for apart from their individual expectations like passenger comfort, luggage space, all terrain-run, unique performance experience,” he lists.

“The automobile industry will soon turn into an SUV hub,” predicts Mr.B.Kannan, MD, SKBR Automobiles. Even in a not-so-high demand market, on an average he is selling eight Mitsubishi Pajeros each month and that is a “terrific going”.

“Customers are increasingly emphasizing on quality with utility. You will find most owners of these luxury cars already having two or three other cars in their garage. Traveling and family outing during weekends is a trend that is catching up and the SUVs come to the rescue of this genre,” observes Mr.Kannan.

Currently vying for the Indian pie in this particularly specialized segment are no more than a handful of big players that make SUV’s. Ford, Honda, Hyundai, Suzuki, and Chevrolet are among foreign companies, while Tata and Mahindra are the leading Indian manufacturers.

“But what makes it challenging is that SUV customers are generally well-traveled and aware of automobile brands from around the world. Another factor is the price, as an overwhelmingly huge percentage of the brands are priced between Rs.15 and 35 lakh, a sum many Indians will think twice about before spending on a second car. Yet, the SUV market is still very much an expanding market, though it is not easy to predict the major trends for the distant future,”

remarks Mr.Kannan.

Most dealers believe that SUVs will pick up as more choices are offered to buyers at lower prices. For the time being, one of the prime factors driving people to the purchase of an SUV is the legacy of the manufacturer. Right now, the SUVs are like the precious glam dolls on the road. They are new, hot and happening and more of a lifestyle statement than a status symbol.

Maybe, in the not so distant future, glancing from the same rooftop, you will see more of these real big toughies than other cars in the parade of vehicles on the increasingly congested roads.

- Soma Basu

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