Latest Car News in India

Monday, June 06, 2011

By Pranjal Gera

All eyes set on smaller and cheaper cars, hoping to get a boost in slowing sales

There was a time when launch of small cars brought about a hike in sales during the crisis period of 2008, now following the same path; these companies have decided to launch a series of small and cheap cars, to continue the high sales.

The car manufacturing companies justify this move as partly defensive and partly opportunistic to keep up with the increased sales in past years, targeting new buyers into making purchases.

The leading automobile companies like Hyundai from South Korea and General Motors from US are towering above all other companies.

Hyundai, having code-named their small car as ‘Hyundai H800’, which is in the final testing state declined to reveal any of its specifications.


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Arvind Saxena, Hyundai director for marketing & sales, said that their product will offer highest fuel efficiency and power in its class.

General Motors India's vice-president for corporate affairs, P Balendran said that they will be targeting the entry level buyers and will be launching there product by the end of this year.

GM, famous for making big cars has now turned its focus towards smaller cars like the Chevrolet Spark, the Chevrolet Beat and the Chevrolet Aveo U-VA.

Abdul Majeed, automotive practice head at Pricewaterhouse said that the buyers are suffering from ever increasing inflation and high EMIs (monthly loan repayments). And so they are more interested in buying small and cheap cars providing a great market for smaller cars.


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We can see the rise in small cars by looking at the sales statistics of Tata Nano, which sold 6,515 units in May, down from 10,015 in April.

Another small car, Maruti Alto of Maruti Suzuki, became the largest selling car worldwide, with 3.46 lakh units sold last year.

The major reason for this hike in sales of small cars is the fact that these cars are fuel efficient, and as the prices of fuels are increasing in India rapidly, these cars will have a better market here.

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