With new launches in the electric vehicle (EV) and hybrid models space, the coming year is expected to drive the transition towards e-mobility at an accelerated pace.
The automotive industry has been through ebbs and flows over the last two years. As this year’s festive season inches closer, there has been active engagement by consumers and an uptick in the demand for passenger vehicles, with preference leaning towards sports utility vehicles (SUVs) and hybrid models, according to Grant Thornton Bharat’s auto survey.
Commenting on the survey findings, Saket Mehra, Partner and National Sector Leader, Auto, at Grant Thornton Bharat, said, “With a 34% y-o-y growth in vehicle sales in H1FY23, the passenger vehicle industry is gradually resurging from the pandemic. Ease in supply chain, a marked improvement in demand propelled by post pandemic festive sentiment and need for personal mobility are driving the sector as per our survey findings. There is also an increased affinity towards electric and hybrid vehicles, suggesting that the industry is on the cusp of disruption, led by EVs and alternative fuel sources.”
Regarding the kind of vehicle people plan to buy, SUVs topped the charts with 31%, followed by compact cars at 28%. There has been a 5X growth in preference for SUVs compared with last year. Preference for EVs and hybrid cars has increased by 46% and 62%, respectively, vis-à-vis 2021. In terms of discounts, 90% of the respondents are expecting festive discounts this year, and most of them are anticipating the discounts to be north of 7%.
The report also highlights an inclination towards premium models and vehicle features. Vehicle feature/design is the first factor considered by most consumers (35%) while making a purchase. Additionally, 29% of respondents are willing to pay a higher price to swap their vehicle for a premium model, and 57% responded that they would decide after factoring in the price difference between the base and premium variant. This is a new trend for a price-sensitive market such as India. While the survey surfaces new trends in vehicle buying behaviour, it also reinforces an existing trend amongst Indian consumers of relying on dealerships to make their purchase (88%).
Over 4000 respondents, across digital platforms, participated in this auto survey by Grant Thornton Bharat.
Key highlights from the survey
- Increased affinity towards EVs and hybrid vehicles
- Growing customer affinity towards interiors/features and premium models
- 90% of the consumers expect a festive discount
- Car dealerships remain the most preferred way to purchase a vehicle (indicated by 88% of respondents)
- Social media promotions remain the main source of information regarding new product launches (49%), followed by print / digital ads (25%)
- 58% of respondents plan to finance their purchase with a mix of loan and self-funding