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Kwid`s success, Nano`s comeback and Alto`s sales helps the entry-level hatchback segment to grow

Renault Kwid Front

The entry-level Indian car market has always been one of the most popular segments in the country. Models in the segment include examples like Renault Kwid, Maruti Suzuki Alto and Tata Nano. Though the latest Renault Kwid and Maruti Suzuki Alto have been among the best-selling cars in the country in recent times, the segment was having a decline in sales for the last four years. So, we are going to talk about how the aforementioned models have contributed to improving sales.

Cars in the entry level hatchback segment in India have recorded a growth of 0.9 percent in the period ranging between April to October 2015. In the month of October, the Alto managed to contribute 46 percent of sales, Renault Kwid contributed a good 10 percent in the first month of launch and the Nano came in with 5 percent.

Though the segment holds a 26 percent share in the overall Indian car sector, this figure was 35 percent back in fiscal year 2012. But with the launch of many capable new models, experts predict that an increase of 20,000 units per month is expected to take place in the coming future.

Renault has received a tremendous response for the Kwid. With low interest rates and softening of retail inflation, Renault is seeing many first time car buyers come to its showrooms enquiring about the car. Adding to the popularity is its amazingly low price tag that starts from Rs.2.57 lakhs (ex-showroom, Delhi) onwards. Just after its launch in India, Renault recorded bookings of more than 50,000 units for the Kwid. Therefore, the company is expected to sell in excess of 7000-8000 units every month in the country, which will definitely add to the segment’s volumes.

The Tata Nano has also seen a rise in sales after its not-so-happy debut in India. After tagging it as a smart city car with an automated manual transmission, Tata has revealed that the hatch has got a lot of interest from first time car buyers in cities like Delhi, Mumbai and Bangalore.

Coming to the Maruti Suzuki Alto, this is one car that has always been performing consistently. It is always among the top two best-selling cars in India with the other being the Maruti Suzuki Swift DZire. But Maruti Suzuki has also seen a dip in average sales of 6.93 percent over the past four years.

An expert economist further revealed that lowering interest rates, decline in inflation and lowering fuel prices has pushed many people to buy new cars. He also states that nowadays, consumers are having more purchasing power that is pushing them to buy more goods thanks to increase in income. Also, many customers who plan on buying two-wheelers are also shifting towards purchasing four-wheelers with the same reason. This in turn is helping the entry-level segment to register a growth in volume.

This is mainly due to the fact that many car manufacturers are launching new models in the segment that holds a clear majority when compared to all other segments in India. Such is the potential that by the end of the decade, India might become the world’s largest mini-car market by overtaking Japan and selling around 1.5 million units.