This is how you can buy cars like Alto, Kwid, Santro at very low price!

Aspirant car buyers are up for exquisite discount this festive season in October, 2023. The reason is that car dealers in India are facing huge inventory levels especially of entry level cars like Alto, Kwid, Santro, etc. As a result, to clear out the high inventory, dealers will be offering steep discount on these cars during the upcoming festive season. Aspirant car buyers stand a chance to save a lot if they buck the trend of SUVs and buy hatchbacks in October 2023. They can get lots of benefits on likes of Alto, Renault Kwid, Hyundai Santro, etc.

According to media reports, inventory of vehicles with dealers has risen to four-year high levels by August end. Share of entry level vehicles in total inventory of both passenger vehicles and two wheelers is already at 60 per cent. So, dealers are expected to offer steep discounts and other types of benefits as well to customers on entry level cars. At the same time, there will be relatively lower benefits on SUVs!

Why inventory of entry level cars is continuously rising?

1. SUVs: The choice of Generation Z

Demand for small cars has remained muted for quite a long time now. It is SUVs, that have been driving passenger vehicle sale in the country in the last one year or two. Low sale of small cars and robust demand of SUVs, has led to this situation.

2. Depleted rural demand

Rural consumption in India has remained muted ever since the Coronavirus pandemic had engulfed the entire country. In Q1 FY24, rural consumption has fallen to lowest levels since December quarter of 2021. According to reports, muted rural demand has dragged down the sale of entry level two wheelers, cars and tractors in the hinterland in April-July period of 2023.

3. Acute semiconductor shortage

Due to thesemi conductor shortage issue, automobile companies had managed to manufacture more number of small cars than SUVs because there is lesser requirement of chips in small cars. But, this was not possible in case of SUVs. So, auto manufacturers continued with manufacturing of hatchbacks during the chip shortage issue, and, as a result, speed of production of SUVs slowed down. On one hand, auto manufacturers continued to manufacture entry level cars and because of muted demand and resultant lower sale, inventory of small cars kept on piling up with dealers.

So, because of all these factors, dealers are expected to give steep discounts on hatchbacks via-a-vis SUVs!