New models launched by car manufacturers during 2015-16 contributed nearly 12 per cent to total sales, up significantly from 7.6 per cent in 2014-15.
The increase is even more in numbers, as sale of passenger vehicles - cars, vans and utility vehicles - rose 7.2 per cent in FY16 to 2.78 million units, the highest so far in any year. From industry data, the 10 new models in FY15 had sales of 197,260 units. In FY16, the 17 new models together clocked sales of about 330,000 units.
The data does not include launches by luxury car makers, since not all of them reveal their sales data.
It is not that the growth in contribution is due to the 17 launches in FY16, against 10 in FY15. The growth is due to some successful and big-ticket launches in FY16, such as of Hyundai's Creta, Maruti Suzuki's Baleno and Renault's Kwid. Each of these and Honda's new Jazz sold a minimum of 41,000 units in the domestic market. In fact, the Creta's was about 64,000. Against this, only one vehicle sold more than 41,000 in FY15 (Hyundai Elite i20, of 75,000 units).
Other big volume ones in FY16 were Mahindra & Mahindra's TUV300 and Maruti Suzuki's S Cross (both a little over 24,000 units). Almost every company launched a new product in FY16. Some happened towards the end (March 31) of the financial year (Brezza by Maruti, NuvoSport by M&M and Tiago by Tata Motors) and their impact will be seen in FY17.
"In India, new models are preferred due to rising aspirations among customers, most of whom are exposed to global trends. In their buying behaviour, they tend to be the early adopters of new products that are advanced in new technology and new features. We believe products like the Creta have met the rising aspirations with a high degree of success," said Rakesh Srivastava, senior vice-president (sales and marketing) at Hyundai.
Volumes clocked by the Creta, Baleno, Kwid and even the S Cross indicate the Indian buyer is not shy to experiment with new products, across segments and price points. And, that manufacturers are able to design products that attract buyers in investing their money. So, product launches will be important for car makers to retain buyers' interest.
Abdul Majeed, partner with Price Waterhouse and a sector expert, said most of the new models come with better and advanced connectivity, and competitively priced. "The profile of Indian buyers is going up and aspirations are also rising. Buyers tend to wait and time their purchase with new launches. They not only seek good fuel efficiency, space and style but also look for advanced connectivity features," he said.