Nano, Alto, Eon emerge best-selling small cars

Price conscious middle class car buyers, shying away from rising fuel bills and higher prices of diesel variants, have been opting for small, fuel-efficient petrol cars, following the revival in demand for passenger vehicles in the first three months of this calendar. This is borne out by the sharp rise in sales for Tata Nano, Maruti Alto and Hyundai Eon models, all of which sell below the Rs 3.5 lakh bracket and offer mileage in the 21kmpl - 25kmpl range.
Consequently, companies are finding it tough to sell the more expensive petrol variants in the small car segment that cost up to Rs 6 lakh, despite offering huge discounts of up to Rs 65,000. Once po­pular hatchba­cks in the higher pr­ice bra­cket su­ch as i10, Estilo and A-Star offer mil­eage in the 16kmpl - 20kmpl range.
“As you move towards bigger pe­trol cars, mile­age doesn’t allow a purchase decision with high fuel prices. So there is no option but to shift to a smaller petrol car. Those who have the money are usually going for diesel cars in higher segments within the small car category,” Shashank Srivastava, chief general manager (marketing) at Maruti Suzuki India, said.
“There is no diesel car in the smallest car segment, but if there was, people would have definitely gone for it,” Srivastava added.
Even as the car market remained flat last financial year, a spike in sales of Nano, Alto and Eon was seen only during Q4 of this financial year. In 2011, monthly sales figures for Alto and Nano had dipped to 26,000 units and 7,000 units, respectively, owing to soaring petrol prices. However, the two cars have returned to their peak monthly sales of over 33,000 units and 10,000 units, respectively.
Hyundai’s Eon didn’t take off too well with initial sales of 6,000 units a month after launch last November. However, this March, Eon emerged the best-selling model for Hyundai, replacing i10, selling 12,500 units, far higher than the company’s other small petrol cars such as Santro (5,359 units) and i10 (10,157 units). Maruti Suzuki’s bigger petrol hatchbacks such as A-Star and Estilo are now languishing at the bottom with sales of just 706 units and 1,001 units, respectively.
“Manufacturers who are unable to offer diesel variants of smaller cars are trying to push sales of their fuel-efficient small petrol cars. People are also opting for fuel-efficient small cars if they can’t afford diesel vehicles. This trend will continue,” said Abdul Majeed, auto practice leader at PwC.
While car sales remained flat at about 2 million units in 2011-12, smaller petrol cars and diesel models are expected to drive growth this year. Hyundai Motor is trying to boost sales of i10 by offering a free colour TV, besides cash discounts of up to Rs 30,000. Tata is offering up to Rs 15,000 rebate on Nano 2012, while Maruti is offering a discount of up to Rs 20,000 on Alto. Hyundai Eon comes with an exchange bonus of Rs 10,000, while Santro carried freebies worth up to Rs 28,500. A-Star and Estilo are being hard-sold with discounts of up to Rs 65,000. Big diesel hatchbacks such as Swift, i20 and Liva continue to sell with no discounts and long waiting periods of up to six months.
Though the overall car market fell two per cent to 1.37 million cars between April and Dec 2011, against 1.41 million in the year-ago period, Feb and March seem to have been the best months for the industry. Some 407,505 cars were sold this Jan-Feb, registering a growth of 10 per cent over the 369,742 cars sold in Jan-Feb 2011, according to Siam data. Sales this March are likely to break previous records when final figures are released, as a majority of the carmakers have been reporting best-ever sales for the month. These include the top three carmakers, Maruti Suzuki, Hyundai and Tata Motors. Sales of diesel cars increased in 2011-12 in the face of rising petrol prices, with 47 per cent of total sales in Jan-Feb 2012 accounted for by diesel variants; their share went up from 43 per cent in April-Dec 2011.