Rising SUV Sales Force Automakers to Cut MPV Production

As we reported earlier, there is a shift of trend in automotive market, where customers are more and more inclined towards purchasing cars that fall in the large vehicle segments, be it new or pre-owned segment. Keeping true to our observations, customer's inclination towards sports utility vehicles is affecting the sales of MPVs. Customers are opting for SUV’s, in lieu of MPV as their preferred vehicle of choice.

Deducing from the data disclosed by the Society of Indian Automobile Manufacturers, in the festive month of October, when automotive sales in India are at their peak,  Honda halted the production of its Mobilio MPV and the trend was followed by other automakers as well. The French automaker, Renault limited the production of its Lodgy MPV to only one unit in the month of October. Consumer disinterest is the primary reason contributing to the stockpile of slow-moving MPV inventories at dealerships across the nation. Even the MPV heavy-hitters like Maruti Ertiga and Toyota Innova witnessed their sales shrink considerably, while other players like Mahindra and Chevrolet experienced a 25 per cent drop in their overall sales.

Sumit Sawhney, Managing Director of Renault India, said "The MPV segment is definitely going to come back, when we start seeing investment happening in infrastructure and roads. The government has already announced 100 smart cities, which will call for demand for more people movement."

Jnaneswar Sen, Senior Vice-president of sales marketing, Honda Cars India, said "The production numbers for Mobilio are as per our plan ... we try to have a healthy inventory for all our models to effectively meet the customer demand."

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