Saddled with excess stock and anxious about slowing demand, car manufacturers and their dealers are pushing discounts to pre-Covid levels in an effort to entice buyers.
Manish Raj Singhania, president, Federation of Automobile Dealers Association (FADA), said, “We are worried about the fact that stocks have gone up and it is now at 37 days against the usual 30 days. The market will see a continuous spike in discounts because inventory levels are going up. The discounts are at pre-Covid levels already in many cases.”
Discounts ranging between Rs 60,000 and Rs 2.5 lakh are being offered by carmakers to liquidate stock. Models that belong to a previous generation, in which emission norms were easier, are being offered at a steeper discount, say dealers. The offers are a mix of direct discounts, corporate discounts, exchange offers, dealer level discounts and other offers.
Car market leader Maruti Suzuki is offering up to Rs 61,000 off on the Alto K10, Celerio, Wagon R and S-Presso. These discounts are almost on par with December 2019 discount levels, said a Maruti dealer.
While models like the Ertiga, Brezza, Vitara and Baleno are in high demand with their waiting period stretching to several weeks, the company agrees that inventory of other models are high and offers are being run on them.
Speaking to FE, Shashank Srivastava, senior executive officer, Maruti Suzuki India, said, “The enquiries have been pretty high but fresh bookings have decreased.”
Tata Motors, the country’s third-largest carmaker, is offering discounts ranging between Rs 28,000 and Rs 35,000 on the Tiago, Altroz, Nexon, Harrier and Safari, while Hyundai is giving away discounts in the range of Rs 13,000-33,000.
Honda discontinued the WRV and is offering a Rs 70,000 discount on it. The fifth-generation pre-facelift City is being sold at Rs 1.3 lakh less.
The Jeep Meridian, which is the larger version of the Compass SUV, is being sold at a Rs 2.5 lakh discount and the regular Compass has at a Rs 1.5 lakh discount. German maker Volkswagen has also rolled out steep discounts with the Tiguan being offered at Rs 1.85 lakh and the Virtus at Rs 1.13 lakh less. Its sister brand Skoda is offering the Kushaq at Rs 1.25 lakh less and the Slavia at a Rs 1 lakh discount.
Such steep discounts come at a time when the industry claims to be sitting on pending orders of more than 700,000 units. Dealers agree than certain models are sold at zero offers and the waiting period on them has extended to more than 9 months in certain cases.
