Indian Automotive Trend - 2012-13

A lot has changed this year in the Indian Automotive Space. Alto is no longer strategically important to Maruti Suzuki as Ertiga has proved to be. Renault clearly overpowers the likes of Skoda, VW, Fiat, GM with the success of just one product - all hail the 'Duster'. M&M pips Tata from the third slot without having an hatchback in its portfolio! Hyundai successfully manages to guard its second spot with the increased numbers from its higher priced products (such as the Verna, Elantra)!

A look on the numbers (Oct'12) - Duster alone vs Skoda, VW, Fiat & GM -

The notable trends of the year were -

• a> 'Diesel'ization - A large chunk of the customers moved to purchase higher priced diesel cars. The consumer was ready to shell out a lakh more for the diesel counterpart as he/she wasn't ready to bear the fear of the 'any-time' increasing petrol prices. No doubt i20/swift fared better in comparison to the only-petrol variant available Wagon-R, i10, Alto or Eon.
• b> First Time Buyers readiness to pay more - This clearly infers a rise in the disposable income of the first time buyer. Gone are the days when consumers were ready to accept the basic features of a car. Nowadays the customer wants 'more' and luxury is in! A car is surely a style statement more than a means of transportation. A probable Alto customer is now buying a Figo/Micra/i20/Beat and is happy shelling out the extra bucks.
• c> Platform Sharing - With the decline in success-rate of new products, OEM's are apprehensive in investing huge money in developing new products. Also the time-to-market is reduced with the concept of Platform Sharing. Lets see some examples -
• i. As against Rs 5.5 bn spent on Xylo, only Rs 1 Bn has been spent on Quanto. The same platform is simultaneously being used on 3 products - Xylo, Genio & Quanto.
• ii. Maruti using the Swift platform for Dzire
• iii. Renaut & Nissan have mastered the trick - Micra / Pulse and the platform raised to Sunny / Scala
• iv. VW & Skoda were the pioneers - Fabia / Polo to Vento / Rapid 



SX4 hatch showcased in Auto Expo

• The results are clearly visible - Honda is now planning to bring a sedan version of its successful hatchback Brio. We wouldn't be surprised to see a hatchback version of SX4/Cruze/Fiesta either in the times to come.
• d> UVology - You need to have an SUV/MPV in the portfolio to keep the cash registers ringing - this was the mantra for all OEMs this year. The segment has magically grown over 50% and have clearly outnumbered their peers in the similar class - Ex: A Duster sells 5406 units in comparison to the similar priced Verna which does 5050 units (Verna being the leader in its class). XUV 5oo alone sells higher than all the D-segment cars combined!!! This has now started a war between OEMs to fasten their plans of launching their MPVs/compact SUVs. These UVs are not only bigger/better but offer equal value to their sedan counterparts. Ex: A Duster provides a mouth-watering mileage of 20.45 kmpl and Ertiga provides 20.77 kmpl!! 
• e> Add as many NEW products as you can - Earlier, Indian consumers characteristic was orthodox and were skeptical to try new products. 'Tried-and-tested' was the mantra and thus hampered the propositions of new entrants. The recent developments new saw the shift of customers to NOVELTY. If an OEM had a better offering, it was accepted with open-heart. Stalwarts like Tata are facing sudden downfall - the reason being no new product offerings in their kitty (the previous launch Aria was on 2010 - no new product offered from the stable ever since).

• * This has now led to a slew of new product launch plans from various OEM's. The automakers are now on a product-offensive strategy mode and expect a host of new launches in the coming times.
• Design as the new 'Differentiator' - The best example for the aforementioned point is Hyundai . With its fluidic design philosophy it has earned a lot of admiration and allowed to successfully establish in high-end segments. The fluidic Verna easily over-threw the segment leader within months of its launch. The neo-fluidic Elantra is on the footsteps of Verna and is currently the best performing vehicle in its segment. Eon also set the trend of having stylishly looking products in the entry level category. No wonder Maruti answered with its 'wave-front' design inspired Alto 800! Even M&M tried something similar with a "Cheetah" inspired XUV 5oo :) The same concept was heard from Ford when they had introduced the 'kinetic' Fiesta!

Indian Automobile Market is now one of the most Volatile and Vulnerable markets in the world. And its is imperative that it would be the most important market for the OEMs considering its tremendous growth potential.