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Tuesday, July 17, 2018

Excise benefit: Compacts the key word for manufacturers

Global manufacturers such as Volkswagen, GM and even Tata Motors showcased their sub 4-metre compact sedans.

By: ENS Economic Bureau | Agra / Greater Noida, Greater Noida | Published: February 4, 2016 3:33:02 am

The impact of a slowdown in rural consumption and a resultant decline in demand for two-wheelers especially motorcycles in 2015 was very evident at the Auto Expo 2016 as a leading player Bajaj Auto along with Eicher Motors that makes Royal Enfield stayed away from the expo that kicked-off on Tuesday.

While there was lukewarm action in the motocycle segment, only Honda Motorcycle and Scooters Ltd came out aggressively, showcasing 10 new models at the expo. Hero MotoCorp also unveiled its first in-house bike Splendor iSmart 110 at the expo.

However, on the passenger car front, the vehicle manufacturers focused their energies on the compact sedan and compact SUV segment — especially catering to the Indian markets. Global manufacturers such as Volkswagen, General Motors and even Tata Motors showcased their sub 4-metre compact sedans. While Volkswagen launched its Ameo keeping in mind the Indian excise regulations and the high growth for the segment, General Motors too showcased Essentia — its compact sedan. Tata Motors unveiled KITE 5 to compete in the segment.

A Volkswagen official told The Indian Express that Ameo has only been created for the Indian market because of the fast growth of the segment driven by the excise tax benefit. “It was a challenge for the designers to create a car between the Polo and the Vento but we have delivered it for India,” he said.

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Maruti Suzuki, Honda Motors, Hyundai Motors and Ford have already launched their products within the compact sedan category.

As vehicles within the segment attract an excise duty of 12 per cent as against up to 30 per cent duty on bigger cars, there was also action in the compact SUV segment too.

While the launch in the segment was led by the unveiling of the Vitara Brezza by Maruti Suzuki, Tata Motors too showcased its compact SUV — NEXON at the Expo. Hyundai also showcased its concept car for the segment. Ford already has its EcoSport within the segment.

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