The COVID-19 pandemic has caused automobile demand to go down in markets around the world. However, the demand for expensive and premium models has shot up. This is due to impulsive buying as per Hyundai Motor India.
At the start of the pandemic, experts indicated that car buyers will choose a more conservative route and will carefully choose their spending. However, in an interview with Moneycontrol, Tarun Garg, director of sales and marketing at Hyundai Motor India said that the customer is now stretching the budget and wants to have everything in their hands today, fearing about the tomorrow. He also said that people thought that the COVID-19 will lead to lower sales but the exact opposite is happening.
Data shared by various car manufacturers show that the customers now show much more interest in buying the middle and higher variants across the model ranges. Only a small percentage of buyers now choose entry-level vehicles.
Manufacturers have sensed the demand for fully-loaded models and have worked to introduce such cars in the market. For example, no manufacturer has launched a vehicle priced below Rs 5 lakh in the past few years. While a lot of manufacturers have launched vehicles priced above Rs 9 lakh in the market.
Even Hyundai, which launched the all-new Creta among a few other vehicles post the COVID-19 pandemic has reported much higher sales coming from the higher-end variants instead of the entry-level ones. In fact, Hyundai introduced the Alcazar, a seven-seater vehicle based on the Creta platform without any base variant. All the variants of the Alcazar are loaded with a panoramic sunroof and many other high-end features.
Cars to go on long drives
After the pandemic, many people were stuck in their homes for a long period of time. With the fear of third-wave looming on the head, the buyers are looking to buy new vehicles as soon as possible. The pandemic has also introduced the fear of travelling in the public transportation systems due to the fear of transmission of the virus.
That is why people are choosing to buy new cars. But why they are choosing the higher end, more expensive variants? The auto loans are currently available at a low interest rate so the consumers do not mind giving a few extra rupees to get a better feature list.
There are many manufacturers that are failing to provide enough supply of vehicles due to the unavailability of raw materials like semiconductors. The price of the vehicles has also increased by quite much since the start of this year. Yet, the demand for high-end variants keeps on increasing every day.