"People are buying used cars instead of new cars. So, Mahindra First Choice sales go up 50 per cent," says Mahindra and Mahindra Chairman and Managing Director Anand Mahindra.
Mahindra and Mahindra Chairman and Managing Director Anand Mahindra, on Wednesday, said he had never, in his over three decade career in the auto industry, seen stakeholders “in such a limbo”, and expressed optimism that things would improve after the general elections.
Talking to select media over lunch at the Delhi Auto Expo here, Mr. Mahindra explained, “Everybody in the world, be it investors or analysts, are holding back their investments. Consumers, even those who plan to buy trucks are postponing decisions.”
“People are buying used cars instead of new cars. So, Mahindra First Choice sales go up 50 per cent. I have never been at a situation where (demand slump) is unrelated to your pocket spend or the recession, there is enormous money out there. But people are saying they want to wait. Everybody is in a state of limbo, I have never seen anything like this before,” he added. He, however, expressed optimism that the “enormous suppressed demand” will take form after the general elections scheduled in May this year. “We are blaming no one. We are just waiting for a new government to come. This will help release the pent up demand,” he said.
The Indian automobile industry is going through one of its toughest phases. Annual car sales declined for the first time in 11 years in 2013, posting a 9.59 per cent dip as the industry is plagued by issues such as economic slowdown, fuel price hike and high interest rates, which have resulted in low consumer sentiment.
About the trends in the future, Mr. Mahindra said, among other things, he expected premium brands to do well.
“I see brands are going to become what determines whether a car company will survive or not...I see premium brands are going to do very well because the world is getting affluent. There will be a polarisation in the future. There will be premium brands, and then there will be those whole bucket of other brands, which don’t say much. And, I hope the place where Mahindra will play is not only its core DNA of ruggedness but it also means accessible technology,” he added.