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Automakers Slash Prices To Boost Sales

July 10, 2024 09:33 IST

Car sales are experiencing a challenging phase with around Rs 60,000 crore worth of inventory lying unsold with dealers.

Kindly note the images have only been posted for representational reasons. Photograph: ANI Photo

Automobile majors Tata Motors and Mahindra & Mahindra (M&M) have slashed the prices of their popular vehicles in a bid to stimulate demand, at a time when car sales are experiencing a challenging phase with around Rs 60,000 crore (Rs 600 billion) worth of inventory lying unsold with dealers.

The monsoon season may also affect the footfall.

M&M has slashed prices by up to Rs 2.05 lakh, while Tata Motors reduced it by up to Rs 70,000 on select models along with benefits of up to Rs 1.4 lakh on popular SUV variants.

Interestingly, the Uttar Pradesh government waived registration fees on strong hybrid cars, effectively reducing their on-road prices by up to Rs 4 lakh.

M&M has announced special ex-showroom pricing for all the AX7 variants of their XUV700 SUV effective for four months starting July 10, 2024.

The AX7 range now starts at Rs 19.49 lakh, down from the earlier price of Rs 21.54 lakh.

This announcement comes with the celebration of the XUV700's third anniversary and the milestone of selling around 200,000 units in less than three years.

To enhance its appeal further, M&M has introduced two new colour options.

Additionally, new variants like the AX5 Select, MX 7-seater, and Blaze edition have been launched, ensuring a broader range of choices for customers.

AX7 range features amenities such as a Panoramic Sunroof, dual 26.03 cm HD Super-screen, Level-2 ADAS with Adaptive Cruise Control, and a 3D Audio system with 12 Sony speakers.

Similarly, Tata Motors in order to boost sales has reduced the prices of its flagship SUVs, Harrier and Safari, with starting prices now at Rs 14.99 lakh and Rs 15.49 lakh, respectively.

Alongside these price cuts, Tata Motors is offering benefits of up to Rs 1.4 lakh on popular SUV variants.

For electric vehicles such as Nexon.ev the benefits go up to Rs 1.3 lakhs and for Punch.ev consumers can avail benefits up to Rs 30,000. These offers are valid till 31st July.

This announcement came as the carmaker celebrated the milestone of selling over 2 million SUVs in India.

"Our ability to understand the SUV segment and provide the right product for every customer needs helps us maintain consistency and dominant leadership in the segment," says Vivek Srivatsa, Chief Commercial Officer, Tata Passenger Electric Mobility.

With substantial unsold inventory along with other challenges, both Tata Motors and M&M's pricing strategies aim to revive consumer interest and stimulate sales.

Retail car sales in India registered a year-on-year (Y-o-Y) drop of 6.7 per cent in June, 2024, the biggest dip in two-and-a-half years.

Why Pre-owned cars are on demand

Anjali Singh

Photograph: ANI Photo

The demand for pre-owned cars surged in Q2 of 2024 (April to June) as nearly half (48.5 per cent) of salaried professionals celebrated their promotions and bonuses with these car purchases, a report by CARS24, an auto-tech company, said.

This shift is driven by a rise in disposable incomes, increasing affordability of pre-owned cars, and a desire for enhanced personal mobility.

The majority of these purchases were made by employees in metro cities such as Delhi, Mumbai, and Bengaluru.

However, these cars' popularity extends beyond metro cities, with growth also seen in non-metro markets.

Agra, Coimbatore, Nagpur, and Vadodara are leading the charge as they saw a 25 per cent increase in sales on average per city.

This highlights the widespread appeal and demand for personal vehicles and the growing demand for pre-owned cars across the country.

The most popular car models among buyers included the Hyundai Grand i10, Maruti Suzuki Swift and Baleno.

The SUV segment also saw significant growth, with models like the MG Hector and Nissan Magnite gaining popularity.

This shift towards SUVs reflects a broader trend, with their market share in the used car segment increasing from 10 per cent to nearly 20 per cent over the past five years.

Feature Presentation: Ashish Narsale/Rediff.com

Anjali Singh

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