Sales of the Etios fell by about 18% month-on-month to 4,095 cars in July because of the general slowdown in sales of petrol-only cars. The July sales trend in compact sedans is further evidence that diesels are gaining at the cost of petrol cars at a time when less people are buying cars.
There’s a new sales leader this month, and for the first time this year, the Tata Indigo and Manza combined are the highest selling models among entry-level sedans, selling 4,877 cars in July.
The other cars that have done relatively well for such a dull month include the Mahindra Verito, whose sales grew a further 8% to 1,630 units.
What has helped sale of these cars, all of which have diesel variants also, is the production constraints for the segment leader, the Swift Dzire. Maruti’s Dzire continues to languish for the second month in a row, with only slight improvement in sales from less than 2,500 units in June to 3,021 units in July (which is still less than one-third the Dzire sales in the previous months).
Car makers are trying various things to help better the proposition for buyers, at a time when both interest rates and fuel costs are rising, thus making people postpone their purchase decisions.
One obvious response has been to ramp up or add the diesel variants. So Toyota is expected to launch the diesel variant of Etios in the next few weeks. And this could be one of the reasons why buyers have deferred their Etios bookings because they want to wait for the diesel car.
The other way compact sedan makers are trying to boost sales is by reducing the car length slightly to take advantage of lower taxes and thus reduce the prices.
The Tata Manza compact sedan (CS) or Tata Vista sedan is likely to be launched in a couple of months, which will be less than 4 meters in length to qualify for lower taxes.
Maruti too will be shaving off some of the length from the Dzire for the same purpose, while there’s speculation that Mahindra may axe the boot off the Verito as well, to benefit from small car excise norms and lower prices, to fuel demand.
The compact sedans segment, just as the small cars segment, is extremely price sensitive. Car makers are well aware of that fact. So buyers can expect better deals and offers in the months to come. Stay tuned for more updates.