It is obvious that with increasing demand for cars and
the increasing number of car models being offered by different car
manufacturers in India, more and more people are likely to scrutinise their options
before actually zeroing in on their final choice of vehicle. With income levels
rising and more vehicles being purchased through car loans, first-time
new-vehicle buyers in India are considering more vehicles during the shopping
process, says a J.D. Power Asia Pacific 2014 India Escaped Shopper Study (ESS).
The finding also says that Maruti Suzuki is the most
considered nameplate among new-vehicle shoppers for the 10th consecutive year,
with 41pc of all shoppers eventually purchasing one of its models. That simply
shows the clout of the Maruti brand vis a vis the rest. New-vehicle buyers who
purchase Volkswagen, Ford and Renault models shop the most before purchasing
their vehicle, while buyers of Mahindra, Maruti Suzuki, Tata and Toyota models
shop the least often before purchasing.
The study, which examines the reasons why new-vehicle
shoppers consider but ultimately reject certain models in favour of another,
finds that 27pc of first-time new-vehicle buyers in India seriously considered
a model other than the one they purchased while shopping in 2014, up from 20
percent in 2012. One of the key aspects driving the increase in cross-shopping
is the proportion of first-time new-vehicle buyers who finance their purchase
through a car loan. Nearly three-fourths (73%) of first-time buyers finance
their vehicle in 2014, up from 64pc in 2012.
The study finds that buyers who finance their vehicle
tend to cross-shop more than those who do not opt for financing. Thirty percent
of buyers who finance their vehicle also consider other vehicles, while only 25
percent of those who pay cash for their vehicle cross-shop. Furthermore, 35 pc
first-time vehicle buyers have a monthly household income of Rs 50,000 or more
in 2014, up from 18 pc in 2012, which enhances their credit worthiness and
enables them to qualify for a higher loan amount.
Mohit Arora, executive director at J.D. Power Asia
Pacific, Singapore mentions that while inflation rates have gone up in India, a
rise in income levels coupled with greater availability of credit has given
first-time car buyers the opportunity to evaluate alternative vehicles across
segments and price bands.
Introduction of new body types across the various price
levels will likely add more vehicle choices for first-time buyers, who account
for nearly half of new-vehicle sales in the country, he said.
Among the key findings of the study, it was found out
that new-vehicle shoppers are increasingly placing greater importance on a
vehicle’s interior in their selection process. Among shoppers, 15pc indicate
the vehicle interior is the primary reason they rejected a vehicle in 2014, an
increase from 4pc in 2012. Issues such as interior styling, driver’s seat and
rear-seat comfort are among the top interior-related reasons cited for rejecting
Another finding is that around 35 pc indicate they
researched the vehicle they purchased before visiting the dealership in 2014,
up from 26pc in 2012.
The 2014 India Escaped Shopper Study is based on the
responses from 8,499 buyers and 3,448 rejecters of new cars and new utility
vehicles who purchased their vehicle between September 2013 and April 2014. The
study, which examines the reasons why new-vehicle shoppers consider but
ultimately reject certain models in favour of another, was fielded from March
through July 2014.
Picture of Maruti
Suzuki Ertiga for representation purpose only