It has been an excellent yr for the passenger car (PV) business. Pushed by sturdy demand for sports activities utility autos (SUVs), PV gross sales remained within the quick lane for a lot of 2023. A number one business government believes the market is at first of a protracted bull run, with premiumisation prone to be a key driving pressure.
In response to knowledge from the Federation of Vehicle Sellers Associations, in November 2023, PV gross sales rose over 17 per cent. Up to now in 2023, gross sales are up near 9 per cent; that is on prime of the 26 per cent progress reported in 2022. Greater than 34.85 lakh PVs have been bought between January and November 2023, versus 32 lakh items within the first 11 months of 2022.
“After two years (2021, 2022) of sturdy double digit progress, we heard this phrase ‘pent up demand’ rather a lot. However, there is no such thing as a such factor. It’s a structural change that we’re taking a look at,” mentioned Sanjay Thakker, promoter and government chairman of Landmark Automobiles.
The corporate is the one listed car dealership in India presently. It has dealerships of a number of manufacturers, together with Mercedes-Benz, Honda Automobiles, Volkswagen, Jeep, BYD, Mahindra and Mahindra, Ashok Leyland and MG.
“The automobile possession in India is simply round 2.2 per cent. In America, as an illustration, that’s 70 per cent. With the type of inhabitants we now have, and automobile being among the many sought-after asset class after a house, we consider that is the beginning of a protracted bull run in India. That is one thing that we consider will play out for a couple of a long time,” mentioned Thakker.
Landmark began operations in 1998 as a supplier for Honda automobiles. It’s presently current throughout 117 areas in 9 states, which incorporates showrooms and workshops. It’s the largest supplier within the nation for Mercedes, Honda, Volkswagen, Jeep, and BYD.
Come 2024, Landmark will enter Telangana, its tenth state of operations, with a facility for Mercedes in Hyderabad. Near 30 per cent of its present operation has been pushed by the acquisition of different sellers. Thakker mentioned the corporate would proceed to hunt acquisition alternatives to develop its enterprise sooner or later too.
Thakker sees a rising development of younger patrons choosing premium and luxurious autos, driving the business progress over the subsequent few years.
“Just below one per cent of all autos bought in India are luxurious autos. Final yr, that quantity was round 38,000 autos, this yr it will likely be round 45,000 items. China, in a typical yr, sells round two million luxurious autos. The variety of millionaires and billionaires in India is rising. Have a look at the inventory market, there is a gigantic quantity of wealth era that’s taking place. So, other than extra individuals proudly owning automobiles, extra variety of individuals proportion clever will go purchase luxurious automobiles,” he mentioned.
India is among the many solely sizeable markets that’s going to see sturdy progress, mentioned Thakker, including that with what was taking place in Russia (the struggle with Ukraine) and China (financial slowdown), all eyes are actually on the Indian market.
Pre-owned automobiles enterprise can even drive the general progress within the passenger car market, he believes. Many corporations, together with luxurious automobile makers, have invested in constructing their used automobile enterprise over the previous couple of years. Pre-owned automobiles enterprise is presently 1.3 occasions the general new automobile market and is predicted to develop at a sooner clip.
In response to a latest report by OLX, India’s used automobile market is predicted to the touch Rs 5 lakh crore (85 lakh items) by monetary yr 2028 from Rs 2.1 lakh crore (46 lakh items) in 2022-23.
