Cheer for auto industry finally, year-end witnesses spike in car bookings

New Delhi | Published: December 23, 2018 4:07:15 AM

Bookings for mass segment cars have surged around 20% compared to last year during the same month, as confirmed by several dealers FE spoke with.

automobile sector, automobile industryMaruti Suzuki India chairman RC Bhargava said these discounts will certainly clear the inventory pile-up that has happened due to subdued festive demand and will also be beneficial for customers, as they will get the best deals of the year.

By Pritish Raj

Having seen a tepid festive season, automakers might end the year on a brighter note with a spike in bookings, even if this is a result of year-end discounts to clear inventory. Bookings for mass segment cars have surged around 20% compared to last year during the same month, as confirmed by several dealers FE spoke with. Because of poor festive season sales, which led to high inventory levels, auto firms Maruti Suzuki, Hyundai, Tata Motors and others have been forced to offer a slew of discounts and offers during December that are 20-25% more than last year. “We have received around 60 bookings so far, mainly for petrol and CNG variants of Swift, Dzire and WagonR. It was around 30-40 last year in December,” a Maruti dealer in NCR told FE. The company is offering discounts and benefits up to Rs 80,000 on cars sold though Arena sales channel.

Maruti Suzuki India chairman RC Bhargava said these discounts will certainly clear the inventory pile-up that has happened due to subdued festive demand and will also be beneficial for customers, as they will get the best deals of the year. A Maruti Nexa dealer said the discount on Ciaz model is very high compared to last year, leading to more takers for it. About 25% more bookings have been reported for Baleno, which is being offered with benefits up to Rs 37,000.

When contacted, a Hyundai dealer said the bookings are higher this year as the discounts are also higher compared to last year. “We have seen about 25% more bookings for Grand i10 and Elite i20,” he said. An executive from Concorde Motors, a Tata Motors subsidiary selling passenger vehicles, said the target to sell the number of cars in December has been increased by the company, as more discounts on high selling vehicles such as Nexon and Tiago are likely to fetch higher sales. “The complete data will be out in January, but so far we have received around 90 bookings, against around 50 last December,” the executive added.

Tata Motors is offering cash discounts and other benefits in the range of Rs 35,000 to Rs 90,000 on the Tiago, Nexon, Tigor and Hexa models. “While deep discounts must be helping, what is adding to the bookings is the price hike announcement by car makers from January,” an analyst with a consulting firm said. Various car makers, including Maruti Suzuki, Tata Motors, Mahindra & Mahindra, Toyota and Ford India, have announced a price hike effective January 2019.

Passenger vehicle sales have been under pressure since July, hit by high interest rates, insurance premium and fuel price hike, among others, resulting in worst-ever sales in at least the past five years. The companies are hoping that steep discounts, as well as announcement of price hike from January, will help clear the 2018 stock.

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