Indian consumers shift gears toward luxury and sustainability in the auto sector: Survey
Oct 28, 2024, 15:51 IST
The Indian automotive landscape is evolving as consumers lean toward both luxury and sustainable options, according to Grant Thornton Bharat’s survey, Shifting Gears: Understanding Passenger Vehicle Market Trends. The survey, gathering insights from over 3,500 respondents, found that 85% are interested in high-end variants, with a notable rise in preference for hybrid vehicles over electric options.
With 40% of respondents favouring hybrids and only 17% opting for EVs, the shift suggests a cautious approach as consumers await more robust EV infrastructure and incentives. Meanwhile, 34% still prefer petrol vehicles, indicating the ongoing transition in consumer preferences. Hybrid vehicles, acting as a bridge, are likely to boost familiarity with green technology, paving the way for broader EV adoption in the future.
According to Saket Mehra, Partner and Auto & EV Industry Leader at Grant Thornton Bharat, automakers must focus on both hybrid and electric solutions to match changing demands. This year’s festive season—typically accounting for 30-40% of annual sales—is critical, yet high inventory levels, weather impacts, and regional elections have slowed growth. Utility (UV) and sports utility vehicles (SUVs) continue to dominate, now representing 65% of passenger vehicle sales with 13% growth year-over-year.
Despite a slow start to FY25, the popularity of SUVs and UVs reflects a strong preference for versatile vehicles. Yet, automakers are grappling with inventory challenges, with 7.9 lakh units worth ₹79,000 crore in stock as of September 2024. To tap into festive demand, nearly 90% of consumers expect substantial discounts.
The survey also highlights a shift in consumer priorities, with a heightened focus on vehicle safety overtaking traditional factors like design or performance. Subscription models are also gaining traction, indicating a broader transformation in how Indians perceive mobility solutions.
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With 40% of respondents favouring hybrids and only 17% opting for EVs, the shift suggests a cautious approach as consumers await more robust EV infrastructure and incentives. Meanwhile, 34% still prefer petrol vehicles, indicating the ongoing transition in consumer preferences. Hybrid vehicles, acting as a bridge, are likely to boost familiarity with green technology, paving the way for broader EV adoption in the future.
According to Saket Mehra, Partner and Auto & EV Industry Leader at Grant Thornton Bharat, automakers must focus on both hybrid and electric solutions to match changing demands. This year’s festive season—typically accounting for 30-40% of annual sales—is critical, yet high inventory levels, weather impacts, and regional elections have slowed growth. Utility (UV) and sports utility vehicles (SUVs) continue to dominate, now representing 65% of passenger vehicle sales with 13% growth year-over-year.
Despite a slow start to FY25, the popularity of SUVs and UVs reflects a strong preference for versatile vehicles. Yet, automakers are grappling with inventory challenges, with 7.9 lakh units worth ₹79,000 crore in stock as of September 2024. To tap into festive demand, nearly 90% of consumers expect substantial discounts.
The survey also highlights a shift in consumer priorities, with a heightened focus on vehicle safety overtaking traditional factors like design or performance. Subscription models are also gaining traction, indicating a broader transformation in how Indians perceive mobility solutions.