Auto sector in India revving up once again

For the automotive industry in India, the two-year period has been rather tumultuous due to manufacturing challenges, but the consumer sentiments towards two-wheelers and four-wheelers segments is gradually picking up in the market. In the second edition of Indian Automotive Consumer Canvas (IACC) 2022, the industry experts from varied backgrounds such as auto manufacturing, banking etc. came together to present an analysis highlighting the recent consumer behaviour towards purchase of vehicles in India.

Over 2 lakh Indians were surveyed as part of the analytical report, and according to IACC, the survey included age groups ranging between 18 to 25 years, 25 to 35 years, 36 to 45 years, 46 to 55 years and 56 years above. As per the latest findings of IACC, presented by Mr. Kaushik Madhavan, Vice President, Mobility Practice, Frost & Sullivan, suggested that more customers are open to purchasing 2-wheeler Electric Vehicle over 4-wheelers in the said category. While 76 per cent of respondents are willing to purchase 2 wheelers (conventional fuel category) this year, 69 per cent would opt to buy a new car.

In all 77 per cent of the respondents belonging between the age group of 18 to 35 are looking for more ways to own a vehicle and are also open to diversified business models, both offline and online purchase. According to the report, 35 per cent respondents have supported the idea of buying a two-wheeler EV in this year, indicating a possible popularity trend of EV ideas amongst Indians. The objective of the survey, according to IACC, was to find how much the Covid-19 pandemic has altered consumer behaviour and vehicle preferences. The surveyor participation has grown from last year which was at 2,02,000 responses whereas in 2022, around 2,56, 351 people participated in the survey within eight days from Tier 1, 2 and 3 cities.

On the adoption of EV, Mr. Madhavan said, “Lack of charging infrastructure is still one of the biggest reasons why people think twice before purchasing an EV. There is some gap to be bridged here. We have a mix of private players, aggregators coming in to install charging infrastructure. We also have OEMs investing significantly for fast charging infrastructure.” Factors such as high prices, safety concerns also have played a spoilsport for wider acceptance towards EV in India. In the conventional fuel (petrol, diesel) category, amongst 19,164 respondent's 74 percent said they would purchase new vehicles, 20 percent said they would opt for pre-owned and only a miniscule percentage of 3 percent opted for a subscription model and leasing model, respectively.

In terms of purchasing a vehicle, amongst 12,535 participants, 48 percent said that they would go to nationalized banks to finance their purchase, whereas only 10 percent would exchange their old vehicle to purchase a new one. Mr. Shashank Srivastav, Senior Executive Director, Marketing and Sales, Maruti Suzuki India, said that apart from the IACC findings, other contributing factors such as precedence over personal mobility as against shared mobility is also resulting in more people willing to purchase new vehicles. He also stated that the demand for used vehicles has also gone up substantially.

Mr. Sumit Bali, Group Executive and Head – Retail Lending, Axis Bank, said, "So, clearly, we have seen consumer confidence and sentiments improve. This year itself, in the Quarter 4 of FY 2021-22, we are seeing a strong momentum in terms of (vehicle) purchase."

https://www.thehansindia.com/news/national/auto-sector-in-india-revving-up-once-again-735255

• Follow @CNCTimes