36% Respondents Plan to Buy A Car After The Lockdown: Report

Coronavirus has wreaked havoc in our lives and has in fact demolished the country’s less than smooth sailing economy. One important industry that has faced the major brunt is automobiles. In fact, all major car manufacturers reported zero sales during the lockdown month of April 2020 which is not surprising. Now, as things slowly limp back to normalcy, there are a few questions that need to be answered. Will car sales ride back to normal? Has COVID-19 hampered your car purchasing ability? What would be the time frame of buying a new car after the lockdown? 

To answer these questions, we refer to the latest survey of prospective car buyers conducted by our sibling, CarDekho. But before we dig into the details, let’s classify car buyers into three segments:

• Entry-level Segment: Rs 5 lakh to Rs 12 lakh

• Midsize Segment: Rs 13 lakh to Rs 30 lakh

• Premium Segment: Rs 35 lakh plus

Entry-level Segment:

The entry-level segment is where most of the action happens in India. It consists of entry-level hatchbacks, premium hatchbacks, sub 4-metre sedans, sub 4-metre SUVs, as well as midsize sedans. Almost all these segments have popular interest in the country.

Data shows that most respondents scouting for a car in this segment are either first time car buyers or those looking for a second car in their home. A handful are also looking to upgrade from their older car. 64 percent voted in favour of buying a new car post lockdown for family needs, while 31 percent believe a personal car can help reduce the chances of infection over crowded public transport.  

But, has COVID-19 impacted your car buying decision? 36 per cent of respondents plan on buying a new car immediately after the crisis, while 37 per cent have deferred their purchase plans. Rest of the respondents are still undecided. As far as the purchase timeframe post the crisis is concerned, 48 per cent of buyers in this segment have said they will buy their car in the next three months, while 12 per cent would buy within three to six months and 12 per cent after six months. 

Midsize Segment: 

Vehicles that fall under this category are midsize SUV, premium midsize SUVs, executive sedans, and entry-level luxury sedans. Out of the four, midsize SUVs are the most popular in India. A few hot sellers here are Hyundai Creta 2020, Kia Seltos, and MG Hector. 

Majority of buyers in this segment are looking to upgrade from their existing rides, possibly from the entry-level segment. And just like the entry-level segment, most buyers in this segment would prefer buying a car for the family post the crisis coronavirus rather than using any other mode of transportation to avoid the potential risk of infection.

Interestingly, voters in both segments had a similar response to whether COVID-19 has impacted their car purchase and the preferred timelines. 

Luxury Segment:

This segment mainly consists of luxury cars. Some well-known names here are Mercedes-Benz, BMW, Audi, Jaguar Land Rover, and Volvo. The data for this segment is rather interesting!

There are no first time car buyers in this segment! Just like the above two segments, 50 per cent of respondents here feel a luxury car is for family needs while 30 per cent have voted for it as a safe way to travel and avoid the risk of infection. Interestingly, 15 per cent are of the opinion that public transport is completely unsafe. 

As expected, most respondents have delayed their plans of purchasing a new luxury car. We believe cash crunch and the sharp economic downfall could be the reason. That said, 38 per cent plan to purchase a new car immediately after the lockdown while a few haven’t made up their minds and have other plans. 

SUM UP:

According to our survey, there is clearly a demand for new cars post lockdown. While a majority have delayed their purchase plans, there’s still an equal number who have voted that they would want to buy a new car soon after the lockdown. A majority have also voted that their next car purchase is mainly for family needs and personal protection.  

The use of public transportation could go down due to safety and hygiene concerns. Moreover, even though car sales stood at zero in April 2020, the majority of the respondents plan to buy a new car within the first three months after the lockdown has been lifted.