Customers prefer premium features, high-end tech now
Premium- Covid speeded up customer choice of premium features and tech-loaded models instead of low-end variants
NEW DELHI : The covid-19 pandemic triggered a massive shift towards personal mobility with most people avoiding public transport and preferring private vehicles to maintain social distancing and protect themselves and their families from the virus.
The pandemic also accelerated a change in preferences with customers seeking more premium features and technology-loaded models instead of low-end variants, according to experts at the Mint Mobility Conclave 2022.
“Initially it was about safety, you wanted a personal space, you did not want to risk shared spaces. But over the last year customers have realised that they are spending more and more time in the car. Which means customers are looking for more features, they want connectivity, and they are looking for high-end cars," said Tarun Garg, director, sales, marketing and service, Hyundai Motor India Ltd.
For hyundai, almost 41% of the cars sold today are pricier than ₹10 lakh, Garg added.
“The second aspect is that people didn’t have many avenues to spend their disposable income during the pandemic so they thought let me spend on a car that has everything. And thirdly, people’s aspirations are going up, they want the best design, they want the latest technologies and best stereo systems. Today, a car is seen more as an aspiration and a reflection of one’s lifestyle rather than just transportation from point A to point B, especially in the last 18 months," said Garg.
Martin Schwenk, managing director and chief executive officer, Mercedes-Benz India, said the German luxury car maker has seen a significant shift in customer profile over the last years and these trends make them bullish about the future of the personal mobility space in India. “When we look back 10 years ago, we had very different customers. They were 5-7 years older than what they are now. 10 years ago we had 1% of our customers who were salaried employees, now it is 10%. We had 3-4% women, now its 10-15%. It’s a shift in the society and customer behaviour and these long- term trends make me very positive," said Schwenk.
Customers are not only seeking more premium cars, but are also slowly gravitating towards electric four wheelers.
“On the EV (electric vehicle) side, we were positively surprised when we launched this car 2.5 years ago. The personal segment penetration was almost zero and we got 2,000 orders in the first month. And right now we are getting 700-800 orders every month and it’s not a cheap car; it costs ₹26 lakh. So there are always subsegments who want to experiment, who want to give you a chance," Rajeev Chaba, president and managing director, MG Motor India, said
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“The whole trend of electrification is being driven by regulations, by the environmental issues and global activist issues and now, especially the young consumers, want to have sustainable solutions—this trend is also driving EVs," he said.
According to Greaves Cotton Ltd managing director and group chief executive officer Nagesh A. Basavanhalli, for two wheelers the current costs of petrol and battery prices will fall over time, and this augur well for EVs. “When you look at last-mile mobility and when you look at vehicles, 80%-plus in India is either a two-wheeler or a three-wheeler. So, if you are going to make a dent in the universe then you have to start here. In two-wheelers the unit economics have been compelling enough. Obviously there are initial costs of the battery, but when you look at the total cost of ownership, I think it pays for itself," said Basavanhalli. “We have millennials and Genz as they gravitate towards electric vehicles, once they come in, chances are that they will not go back to IC engines," he added.
Avinash Joshi, chief executive, NTT India Pvt. Ltd, said as customers demand more features and more technologies, such as connectivity in their cars, the issue of security is also becoming an important factor in mobility.
“As technology advances and as the lifestyle and consumer demands change, cars are going to have a lot more electronic chips and software than they had in the past. With infotainment and connectivity becoming a crucial aspect...that then brings us to security. That’s one important aspect and that’s where technology will play an important part," said Joshi.
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