Consumers looking forward to brand new launches by auto companies in the upcoming festival season may be a little disappointed this time. Reason: Unlike previous years, especially the last two, this time there has not been new launches by major car companies. All they have come with is model upgrades with few exceptions.
Analysts attribute this to strategy as well as capacity constraints at the two major passenger vehicle manufacturers, Maruti Suzuki and Hyundai Motor, that together command a 67% market share. For instance, Maruti Suzuki, which launched its premium hatchback Baleno in 2015 and in 2016 its popular compact sports utility vehicle Vitara Brezza, saw a huge response in the form of bookings. Baleno, which had a waiting period of 25 weeks, has seen some easing during recent months with the commissioning of the first unit of the company’s Gujarat plant. The waiting period has now come down to 16 weeks. Similarly, Brezza also has a waiting period of 16 weeks, which at one point of time was as high as 20 weeks.
Maruti’s competitor Hyundai too is facing capacity constraints — it is running at full capacity and needs to establish a new plant. The company’s last new product launch was its popular selling SUV Creta in 2015.
Analysts said that since Maruti has a huge backlog, it does not make sense for it to come out with a new product, while Hyundai will have to reduce exports as well as plan a new plant if it wants to come out with new offerings.
As a result, companies have this time around come out with product upgrades. Maruti is somewhat an exception as it earlier this year launched a new product, the Ignis. It also came out with a new variant of its popular sedan, Dzire, which the company claims as a new product as the platform has changed and only the name remains the same.
Hyundai has come out with a refurbished variant of its mid-size sedan, Verna, which was first launched in 2011and had a popular run for a couple of years.
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The country’s third largest carmaker Mahindra & Mahindra has not come out with any major product, either new or refurbished, this year. Its last launches were of its compact SUVs — TUV 300 and KUV 100 — in 2016.
Japanese carmaker Honda has not come out with a successful new launch for quite some time. This year it came out with a new variant of its popular sedan, City, which has seen good offtake in the market.