It is a passing of the baton of sorts that has happened only once in the last three decades. Maruti Dzire, the compact sedan by India's largest carmaker has ended its stablemate Alto's 13 year dominance at the top of the charts to emerge as the bestselling car in the country in 2018.
Dzire's tally of 264,612 units in 2018, a growth of 17.6 percent over 2017 was more than Alto's tally of 256,661 units that was stagnant over the previous year. Dzire had been closing in on the Alto over the last 3 years highlighting a growing trend among consumers to opt for bigger more feature rich cars against bare bones entry level models that bank on lower price point.
The facelift in May 2017 has helped Dzire log all time high annual sales during the year. At the same time, Alto is now well under its peak annual sales of 2011 when it hit 311,367 units and also became the best selling small car in the world in a single market between 2011-14.
It is a dominating theme in the bestseller's list of 2018 where more premium models have outsold their budget oriented counterparts. Hyundai's Elitei20 for example found more customers at 141,104 units than the Grand i10 (134,249 units). The latter was also the car that suffered the maximum decline in sales during the year at 13.27 percent.
Similarly, another old warhorse from the Maruti stable-the tall boy Wagon R, also had a forgettable year dropping out of the top 5 for the first time ever with a 8.9 percent decline in sales at 152,020 units. It was replaced by the company's compact SUV Brezza in the top five. Maruti's Swift and Baleno also significantly outsell the much cheaper Celerio hatchback as well.
"The Indian consumer preference is changing. He does not only want a budget car anymore but he wants features, power and better styling and safety," says Kenichi Ayukawa, Chief Executive Officer, Maruti Suzuki India Ltd. "Earlier affordability was the biggest factor. It still is important but there are other considerations too."
The stagnant volumes of the Alto that overtook its predecessor Maruti 800 in 2005 to become the bestseller in India, underscores the gradual decline of the entry level segment in India. Fewer number of models on offer and lack of new launches has also affected the category.
The last new model to enter the fray was Datsun Redi-Go in 2016. It had followed the launch of the Kwid, based on the same platform, a year before. It has also seen many false dawns with companies like General Motors, Volkswagen and Honda contemplating and then pulling out of developing a product for that segment. In comparison, the premium hatchback segment witnesses at least half a dozen refreshes or new launches every year.
Once the backbone of the Indian car industry, the small car segment in the country today rides on less than 10 models. In contrast, premium hatchback and compact sedan segments have more than two dozen options. Add the nascent compact SUV segment and the number crosses 30.
"Whenever new models are launched in any segment, we have seen an expansion in volumes of that segment. This is something that has not happened in entry level category," says R. S. Kalsi, Executive Director, Marketing and Sales, Maruti Suzuki India Ltd. "It is also impacted by the growth in the pre-owned car market, which is now roughly estimated at two times the market for new cars."
Customers often prefer to buy a used car as their first car, learn to drive with that car, and then graduate directly to a premium hatchback, according to Kalsi. "This is corroborated by increase in the number of first-time owners of Swift and Dzire," he says.
Is it the end of the road for the Alto? Not quite. At over 250,000 units per annum it is still bringing in the numbers. Further there is no car that can beat it or even challenge it on its own turf. The last one to do so-the Renault Kwid, has fallen by the wayside while Hyundai's Eon has ridden into the sunset. 2018 however proves that father time has caught up with the diminutive bestseller. The glory days are all in the past now.