Things are looking up. Cars sales are up to 60 per cent of their pre-Covid levels. And there are no alarming signs on the horizon. In fact, the pace of good news and new car launches just keeps on increasing. Plus, the optimism can now be felt across OEMs as well. And that’s clear in our third and final installment of ‘life in the Covid era’ series of the CarWale CXO Interviews.
This time we spoke with Manohar Bhat – Head, Marketing and Sales, Kia Motor India. After having gotten the views and outlook of a mass-market carmaker and a luxury carmaker, we thought it is prudent to get the views of a new entrant in the Indian car market as well. Here’s how it panned out…
For starters, Kia is taking an optimistic outlook. According to Bhat, things can’t get any worse than they did in April this year. So sales are only bound to get better going forward. And it’s the festive season that might mark the true revival of sales. But, some help would obviously be welcome.
Bhat: If the government does more in terms of demand enhancement, it would be overall very good for the economy, I believe. Our recommendation, as a part of SIAM, was for the government to reduce GST for a limited period of time. But then, I believe that the government might not have the bandwidth to give that type of benefit just now.
We also suggested that the government should give the consumer maybe an advantage of tax benefit in case he purchases the vehicle like they give the corporates a depreciation benefit. Likewise, they can give the income-tax payer some benefit in case he purchases the car or else they can give benefits in terms of a car loan that is being taken on the same lines as they give for a building or a flat that is purchased by the consumer.
Carmakers would need to do their part as well to lure in customers. A safe and sanitised showroom is a given. But, Kia is also working towards reducing the delivery times of its vehicles. Being able to get a car immediately, especially when people might be moving away from public transportation or shared mobility, will also be a key enabler in bringing back sales. Bhat says that on top of this, finance schemes with attractive EMI options, a seven or eight year loan period, and schemes that will protect the buyer from non-payment of EMI for a limited period, will also be important in attracting customers.
Digital again will play a big role in Kia’s scheme of things too.
Bhat: With this pandemic and the lockdown, consumers are very wary of getting into crowded places or going into a strange place or touching objects, which they feel, might be contaminated. So this has obviously led to more people doing things online. This was a phenomenon that was already taking shape before the pandemic but now we see that this has increased.
Bhat adds, Kia was also the first Indian car automotive OEM to have a fully online sales process for the customer when it launched the Seltos. Everything from online booking to doorstep delivery was something Kia was doing way back in August of last year, claims Bhat. Now of course, the number of customers going through the online purchase journey has increased. And they are going beyond just booking the cars online.
Bhat: But, we also see that ultimately most customers do want to come and see the vehicle at least once in the showroom before taking delivery. They come and see the colour, see whether the vehicle is in good shape before delivery, etc. So still we believe that while it’s going to be more and more online, there will be some component of the brick and mortar shop coming into the customers purchase journey, even going forward.
When it comes to changing customer needs, Bhat doesn’t believe there will be a dramatic shift in preferences.
Bhat: Normally there are very few events that cause a very drastic change in the customer behaviour, over a long period of time. I believe that once the fear of the virus goes down because of a cure or a vaccine coming in, we might see customers going back to the old normal. But again, when this is going to happen is a million dollar question. But I still believe that, yes, customers would like to go back to the earlier habits as and when their fear factor fades out.
As for changes that one might see at the end of the dealer or an OEM…
Bhat: The first things are the hygiene factors. Having a very safe environment for the consumer and the employee, meaning that we have to take all the steps to make sure the customer and employee are healthy. Sanitising the hand, sanitising the entire premises very often and also wearing face masks, observing social distancing, and very importantly making sure that the test-drive car or anything that the consumer is using, has been sanitised before and after the use. Secondly, for the workshop, the customer has to be given the assurance that the vehicle is being handled in a very safe manner and when it is handed over to him, it is fully sanitised among others, so that he is confident of giving the car and getting it back in a good shape.
There is bound to be an increase in doorstep pick-up and drop services as well. And dealers would have to work hard to put the right infrastructure in place to be able to deliver on this demand.
As for new car launches, Bhat says the Kia Sonet launch is on schedule. And so, come August or September we should see the new sub-four metre SUV that will take on the likes of Hyundai Venue and the Maruti Suzuki Brezza in showrooms. Bhat claims the Sonet will be a really exciting product for the Indian auto industry. He adds that it will have a host of cutting edge first-in-segment and first-in-industry features. And that too will come with an intelligent i-clutch, which will allow the driver to shift gears without having a manual clutch.