Festive Season proving unfruitful for Indian auto sector

The festive season is considered as the best time to purchase cars and invest money in automotive sector in India. Several major launches are held during this period and numerous special edition versions are put up by the manufacturers in order to lure as many customers as possible so as to witness a considerable hike in their sales charts. Multiple lucrative offers like cash discounts, exchange bonuses, free road side assistance etc are added incentives being provided to the customers by the manufacturers to keep their products selling off the shelf.

Therefore every auto-maker is coming up with different strategies to enhance their customer domain. Even the country's leading auto-maker Maruti is offering cash discounts and exchange bonuses on its selected cars. Its premium hatchbacks Wagon R, A-Star, Alto 800 , Alto K10 are available at a cash discount ranging from Rs. 20,000 - 30,000 along with an exchange bonus of around Rs. 10,000 - 28,000. Ford is enabling a cash discount or accessories worth Rs. 40,000 - 60,000 on its sedan Fiesta and Classic. Honda isn't much behind in this race as its allowing a cash discount of Rs. 1.5 lakhs on its premium saloon - Accord. The hatch brio is being offered with Rs. 5000 discount along with free insurance. Korean auto-giant Hyundai is providing a flat discount of Rs. 40,000 on the i10 while Sonata is up for customers on a discount worth 1.5 lakhs.  

Even, 'The Big Three' - Mercedes Benz, BMW and Audi have presented several highly lucrative offers for its customers in the form of cash discounts as well as exchange bonuses. Audi has targeted Q Series and A Series in pursuit of higher sales figures. In Q Series, the top of the line Q7 is currently being offered at a flat discount of Rs. 3.5 Lakhs while mid-size Q5 is coming with a 3 lakh discount followed by Q3 that has 5 lakh rebate. In case of sedans, A6 and A8 are being offered with a cash discount of Rs 5 lakhs. Moreover, the popular A4 sedan comes in at a dicount of Rs. 3 lakhs. Meanwhile Mercedes-Benz India is offering a cash benefit of Rs. 4.5 lakhs on its C-Class. Whereas BMW too is offering a cash discount of around Rs. 3.5 - 7.0 lakhs on its selected models like X1, X3, X5, 3-Series, 5-Series and 7-Series.

But all these efforts have gone in vain, as still their sales figures have shown no signs of progress indicating a negative growth. Going by statistics, the period from April-October period has registered a decline in growth by 4.62 percent in passenger vehicle segment in comparison to last year. Within its umbrella (Passenger Vehicle Segment), the sales of passenger cars witnessed a de-growth of 4.50 percent, while the utility segment experienced a downfall of 2.76 percent followed by 9.80 percent for vans against the same tenure last year.

This downfall in sales is being contributed by several prominent factors that popped out during this time period. The ever rising inflation in the prices of petrol and diesel can be considered as one of the major reasons. Increasing interest rates also played its part perfectly in this unlikely phase. Instability in the dollar prices resulted in increase of prices for almost every vehicle to some extent which has deprived customers from reaching out to purchase their desired car.