An analysis into the choices available to the Indian customer
A person looking for a car today is spoilt for choice. There is an assortment of options for the buyer in each segment. But is so much choice any good? Or does it only lead to consumer anxiety with the fear of making the wrong choice, or the fear of missing out?
badtman recently shared this with other BHPians.
Hello everyone, my membership just got accepted yesterday, and I am very thankful for that. Thought I’d begin this journey on the forum with some light-hearted analysis. Cheers!
The Indian Automotive Scene has changed a lot over the last decade. A person looking for a car today is spoilt for choice. There is an assortment of options for the buyer in each segment. But is so much choice any good? Or does it only lead to consumer anxiety with the fear of making the wrong choice, or the fear of missing out?
To take a dive into the choices available, I developed my own ‘Car Consumer Choice Index’. For that, I collected the price data (base model to top model) of all the cars on the market (only till 50 lakh ex-showroom as the prices get too wonky after that).
Preliminary data analysis:
Now, to calculate the choices available to a customer, I made some assumptions, which might be debatable, but I believe they present a good picture – the primary assumption is that anyone that has money to buy a 25 lac car would not bother with a 10 lac car even though he can afford it. So, for him, the only choices he has, are in the 25 lac range. This is just illustrative of the concept used in my index. Now, to calculate the choices available, I counted all the cars where the person’s budget lay between the base model and top model prices. I present to you the Car Consumer Choice Index!
The Car Consumer Choice Index
Through initial observations, it is clear that consumer choices increase very rapidly up till 9 lac, before falling down again and stabilizing after around 25 lacs. This means that car choices vary widely with the budget that you have, with the toughest choices being made at around 9 lac. Now let’s look into the graph in a bit more detail.
An analysis into the index:
1. Pit of Despair
The pit of despair is aptly named. If you have a budget of fewer than 3 lacs, then you only have 2 choices. The Maruti Alto 800 and the Datsun redi-GO. Though this may seem like a bad situation, it can be a blessing in disguise, since you only have to choose between 2 cars. And the winner would be obvious to many without a doubt.
2. Cliff of Rising Action
This section is named as such due to the phenomenal rise in the number of choices available to a customer (from 3 cars to 20 within a span of 3 lacs), and the range of vehicles from the lowly S-Presso to the very capable Figo.
Now, this might be a lot of cars to choose from, but the choices here are not that difficult. Due to the steady slope of the graph, the more budget you have the better the car. This makes the choice fairly easy, especially when compared to the next section!
3. Plateau of CSUV
Anyone who has ever researched on the sub-4m SUV segment knows about the plateau and also dreads it. This ‘Plateau of CSUV’ has been named in honour of the segment which accounts for almost 30% of the total car sales in India. This segment is the current trend of the market, with every manufacturer wanting a piece of the pie. This has made choosing a car all the more difficult. Almost all the offerings are capable cars with good engines and sorted driving dynamics.
The plateau also encapsulates the ‘Peak of Nirvana’ where the choice of cars maxes out at a whopping 25.
4. Valley of Depression
If you thought there would be lush pastures beyond the ‘Cliffs and the Plateaus’, you are in for a shock. Because here lies the ‘Valley of Depression’. The choices fall rapidly as you increase your budget, and manufacturers have been contracting their offerings in this segment in recent years.
Although the prices some of these cars command are at a premium, they also carry with them a plague of issues like untested/poor GNCAP ratings, brake failures, dead steering etc. Though this can not be said for every vehicle in the category as there are some very competent vehicles in here like the Thar, Innova and Compass. Thus, this valley has a bit of something for everybody. Choosing a car here means identifying your wants and good-to-haves, as you get everything from bling and gizmos to 4×4 and torquey diesel’s.
5. Plains of Fertility
If you survived the trials and tribulations so far and reached here, welcome, for you have arrived at the Plains of Fertility. The playing field opens up and you get to indulge yourself. The choices in this segment are fairly limited, at around 5 cars for every budget and stay almost constant throughout. But this doesn’t mean that the choices get much easier. Since many cars in this segment are equally competent, it requires tough decisions to discard them and come to the conclusion. This segment plays heavily on brand value, and if choices overwhelm the customer, they simply go with the one they are the most familiar with.
With this, my discussion on the Car Consumer Choice Index has come to an end. This was my first thread on Team-BHP and I hope you all enjoyed reading it, as much as I did in writing it. The above take is just casual speculation and is not intended to be taken very seriously, but I hope this stirs discussion on the choices available to us in the car market.
Thanks to badtman once again! Check out BHPian comments for more insights & information.
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