Car buyers switch gears to go for feature-rich, bigger models
cost-conscious market. The share of the Rs 7.5-25 lakh price segment is currently the largest at 67%. Within this, the Rs 7.5-12.5 lakh price band, at 42%, is the biggest, according to Jato Dynamics data.
Five years ago, the cars priced below Rs 7.5 lakh constituted the largest segment at 58%. With car prices going up owing to rising commodity prices and stringent regulatory standards, the price-sensitive segment below Rs 10 lakh has seen falling sales, said Shashank Srivastav, senior executive director, Maruti Suzuki, the country’s biggest carmaker. There is a paradigm shift in consumer behaviour regarding aspects such as technology and safety.
Expectations were previously limited to features such as air-conditioning and power windows. Car buyers have now started seeking out features such as voice-recognition navigation systems, sunroofs, touchscreen displays, 360-degree cameras, electronic traction, cruise control, hill hold control, low tyre pressure indicators etc., all of which have led to a further increase in prices. This segment of car buyers is less affected by rising prices as they have more disposable income, said Srivastava.
Some consumers are also seeking features such as advanced driver-assistance systems (ADAS) to enhance safety and convenience. For most massmarket car makers, over 50% of sales currently is in the price band above Rs 10 lakh. This has also led to more launches in the segment — nine this calendar year.
Due to changing lifestyles and the rise in disposable income, at least for some, the average age of car owners has dropped. Customers now extensively research vehicles online, read reviews and compare prices. This is a big change from the past where the comparisons were limited to price, said
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