Rising Interest in Electric Vehicles, Changing Ownership/Financing Patterns, online Buying, Finds Mobility Outlook IACC Survey 2022~
- 69% of respondents have plans to purchase 4W and 76% have planned to purchase 2W in the year 2022
- 80% of respondents have postponed their decision to purchase 4W and 82% for 2W due to the outbreak of the COVID-19 pandemic
- 33% respondents willing to buy a 4W EV this year – exactly the same as in the previous year
- 40% respondents against 37% last year are willing to buy a 2W EV than the previous year
- 20% respondents against 14% are inclined to purchase a pre-owned vehicle
- 41% respondents against 56% are willing to purchase a 4W vehicle online
- 43% respondents against 60% are willing to purchase a 2W vehicle online
- 18% 4W respondents against 14% in the year 2021 are trusting on personal savings and liquidity while purchasing a vehicle
- 24% 2W respondents against 20% in the year 2021 trusting on personal savings and liquidity while purchasing a vehicle
Mumbai, 25 March 2022: Mobility Outlook, India’s most holistic media platform covering the mobility ecosystem, and a brand of CarTrade Tech, has released the country’s largest, most widespread, and in-depth survey of the potential four-wheeler and two-wheeler customers. The Indian Automotive Consumer Canvass (IACC), powered by Axis Bank and validated by Frost & Sullivan, received 2,56,351 responses over the course of the survey.
With the objective of understanding the preferences on vehicle purchase pre and post COVID-19 and the rationale behind the change in preferences, the survey was released through a virtual panel discussion led by Shashank Srivastava, Senior Executive Director – Marketing & Sales, Maruti Suzuki India; CS Vigneshwar, Secretary, FADA; Sumit Bali, Group Executive & Head – Retail Lending & Payments, Axis Bank; Kaushik Madhavan, Independent Consultant, Frost & Sullivan; Deepangshu Dev Sarmah, Editor, Mobility Outlook and Banwari Lal Sharma, CEO – Consumer Business, CarTrade Tech.
The survey targeted people above the age of 18 years in order to provide a comprehensive picture of the consumer’s behaviour.
Buying Electric Vehicles
The study found that 40% of two-wheeler customers were willing to buy an EV this year compared to 37% a year earlier. Meanwhile, there has been no change in the percentage of consumers looking to buy a four-wheeler electric vehicle. One-third of the respondents said they are willing to buy an electric four-wheeler this year. The report shows that better products are leading to more choice for customers. Affordability was voted close to 30%, which is a very positive sign. Customers are realising that EVs can compete with conventional vehicles while remaining affordable to own and maintain. Customers are most concerned about a lack of charging infrastructure.
Ownership to Usership
According to the survey, 74% of customers are interested in purchasing new vehicles. An estimated 20% of respondents expressed interest in purchasing used cars as their next vehicle. The preference is expected to last for the next two to three years.
Explaining the need to bring higher transparency in the pre-owned car segment, Mr Banwari Lal Sharma, CEO – Consumer Business, CarTrade Tech said, “The pre-owned car business is largely unorganised in India, and because of varied usage patterns by individuals, judging a pre-owned car online is considered high risk. We need to bring a standard as well as credibility into the online pre-owned market to maintain a balance between online and offline methods.”
Digital Shift
According to this year’s report, 49 % of respondents showed a willingness to buy vehicles digitally. The reasons for the popularity of online mediums were better deals, convenience. On the other side, the inability to touch and feel the vehicle was cited as the top reason for not opting for an online purchase 28%.
Delayed Purchases
As per this year’s report, 80% of respondents postponed their decision to purchase a four-wheeler vehicle and 82% postponed their decision to purchase a two-wheeler vehicle due to COVID-19 after effects. This year has seen an increase in the number of people deferring vehicle purchases, and it will take some time to recover from the effects of COVID-19.
Financing Options
A majority of respondents still opted for traditional preferences, when it comes to financing options. Nationalized banks (57% for 4W, 48% for 2W) are the most preferred mode of financing new vehicles, followed by personal savings & liquidity (18% for 4W, 24% for 2W), private financial institutions (17% for 4W, 18% for 2W), and exchange with existing vehicles (8% for 4W, 10% for 2W). It indicates a finance-wise and risk-calculative approach towards vehicle financing.
Top Choices
In terms of body types most preferred by the surveyed consumers, compact SUVs (30%) witnessed a higher demand as compared to bikes. There have been many videos in the media recently showing E2Ws catching fire. This has left a bad taste leading to safety concerns.
Commenting on the survey insights, Mr Banwari Lal Sharma, CEO – Consumer Business, CarTrade Tech said, “The survey indicates a positive sentiment and reiterates the findings of this year’s survey, where we can see that the people are willing to buy new vehicles but there are many factors which are affecting customers decisions. They are recovering from financial problems. Customer’s preference to explore Leasing/ Pre-Owned/ Subscription models is quite positive at 26%. The electric vehicle market needs to focus on charging infrastructure to increase its sales.”
Further, he adds, “we need to bring newer models with affordability to witness good growth in coming years.”
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