Over the past week, the Society of Indian Automobile Manufacturers held its 63rd Annual Convention in New Delhi. Behind the smiling faces and constant handshakes, there wasn’t just the fear of the stubborn viral fever doing the rounds in the city, but also the fact that sales in the industry were lagging and stockyards were full to the brim.
The Federation of Automobile Dealers Associations (FADA) said in their September sales release that currently 70-75 days worth of stock—about 7.8 lakh vehicles valued at Rs 77,800 crore—were at dealer stockyards across the country. One of the reasons they gave for this was aggressive dispatches by automotive manufacturers.
Truth be told, most manufacturers have realised the scale of the problem. After a couple of years where customers faced months-long delivery delays and what can only be described as price-gouging on certain models, discounts are back in focus. These are not just ‘unofficial’ discounts that someone discovers at the showroom. Some, like the recent ones announced by Tata Passenger Electric Mobility (TPEM), the electric vehicle arm of Tata Motors Passenger Vehicles (TMPV), were officially declared discounts in a press release, offering price cuts of up to Rs 3 lakh on certain variants of the Nexon.ev.
However, if you were to walk into a car showroom—barring a few models—you could probably strike a very good deal for yourself. Whether you are in the market for an Alto or a luxury sedan. One automotive executive told me about ‘dark pattern’ advertising on social media, “When I’m in my car driving past the automotive showrooms on Golf Course Road in Gurugram, I can see offers crossing Rs 10 lakh on some luxury car models.”
Slowdown in demand
Why is this happening? As Shailesh Chandra, Managing Director, TMPV, told me during the launch of the new Curvv a few weeks ago, the automotive market has grown rapidly since Covid. “At the end of March 2020, the industry was at 2.8 million vehicles sold domestically, the industry closed March 2024 at 4.2 million. That is an incredible growth of 50 per cent in four years, far higher than GDP growth in India,” he said, “ It is only reasonable to expect that there will be a slowdown in demand.” Chandra also told me that the overall economic situation is still quite good in India and demand in the coming months ought to be positive.
Tata Motors, Maruti-Suzuki and Hyundai India, all saw sales decline in August this year. This was attributed to several reasons, including a delayed festive season in 2024 compared to 2023. One automotive executive said that September could be worse, as the second half of the month falls during the inauspicious Shradhh period, with hopes for a recovery only after the Navratris begin on 3 October.
There are other headwinds too. The Delhi Government recently withdrew the circular granting Road Tax exemption to electric vehicles, leading to a drop in EV sales in the national capital.
Carmakers are banking on a wave of new launches—from the aforementioned Tata Curvv, the Mahindra Thar ROXX, the facelifted Hyundai Alcazar, the new Maruti-Suzuki Dzire, the MG Windsor, and even the new Mercedes-Benz E-Class—to give the market a boost. But new vehicles also come with discounts on outgoing and older models, which are extremely attractive right now. So, should you buy?
There has not been as good a time to buy a vehicle in India since 2019. Not only there are official and unofficial price cuts by car companies, but those with finance arms are also offering very attractive finance discounts. For example, if one was to purchase a new Maruti-Suzuki Jimny, the finance discounts can total up to over Rs 2 lakh if one played their cards right. It is a similar story at some other companies as well.
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Make your pick
Opting for such financing deals can limit some of your choices, like which bank to get a loan from or which insurance vendor to use, as some deals also bundle low-cost insurance packages. And, of course, when dealers offer accessories, you should remember that those ‘original’ rubber floormats they claim cost Rs 10,000 as part of a ‘one lakh worth of accessories’ package can be found for less than half that price at an accessory store or online.
Things are not as bad as some might make them out to be. BMW India President Vikram Pawah said that there was a lot of ‘YOLO (You Only Live Once) buying’ during Covid and people who would otherwise have waited to buy a luxury car till later in their careers were entering the market. “However, for BMW, if the first six months of 2024 is any indication, growth is still very good as our sales climbed 21 per cent over the first six months of 2023,” Pawah said.
The bottom line is good deals are being offered across the automotive board right now; it is the best time to buy a car. Just search for the one that suits your needs.
Kushan Mitra is an automotive journalist based in New Delhi. He tweets @kushanmitra. Views are personal.
(Edited by Ratan Priya)