SUVs in high gear, models like Vitara Brezza, Creta, Ecosport catch fancy of buyers

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Changing customer preferences is forcing two and four-wheeler buyers to explore uncharted segments such as sports utility vehicles (SUV), scooters and even mopeds.

All three segments defied the sluggish trend in the automotive industry last year. One in every four passenger vehicles (PV) sold was a utility vehicle (UVs), data by Society of Indian Automobile Manufacturers (SIAM) shows. This is contrast to the the trend a couple of years back when mini cars were the rage.

UVs sales grew 30 percent last year to 7.62 lakh units even as the entire PV segment (cars+UV+vans) grew less than 10 percent to 30.4 lakh units

New launches like Maruti Suzuki Vitara Brezza, Hyundai Creta, Ford Ecosport and Toyoto Innova Crysta set the UV market on fire last year. Sports utility vehicles--a subset of UVs--now command a 25 percent share of PV market, against 14 percent 5 years ago.

Higher seats, bigger interiors, stylish and broad exterior design and ability to deal with off-road terrain have made UVs the darling of consumers. So much that companies like Maruti and Hyundai, better known for their small hatchbacks, have moved to bigger SUVs to remain relevant.

Similarly,scooters--a predominantly urban product--are now a hit in semi-urban and rural areas as well. This has cost motorcyles some market share.

Led by Honda Activa and TVS Jupiter gearless scooters have rapidly replaced old generation economy 100-110cc motorcycles in urban areas and they are now making in-roads in semi-urban and rural areas where such economy bikes are sold in huge numbers.

One in every three two-wheeler sold in India is now a scooter, SIAM data shows. Last year, scooter sales grew 11 percent to 5.6 million units, and now have a 32 percent market share among two-wheelers, compared to 19 percent 5 years ago.

The entire two-wheeler segment grew under 7 percent, weighed down by a sub 4 percent growth in motorcycle sales to 11.09 million units.

Hero Motorcorp, the biggest manufacturer of 100cc bikes of brands such as Splendor and Passion, has beefing up its scooter offering. It now has three scooters in its line-up and plans to add at least two more in the coming period. Piaggio, TVS Motors and Suzuki too have launches lined up.

Demand for the humble moped too is rising. Moped sales grew 23 percent last year to 8.9 lakh units from 7.23 lakh units sold in 2015-16. Its share has also grown to 5 percent from 4.4 percent.

TVS Motors is presently the only manufacturer of low-cost mopeds in India, as defined by SIAM. But Japanese giant Honda launched a two-wheeler called Navi whose characteristics are similar to that of a moped but priced nearly two times more.

Two years ago Mahindra & Mahindra, which has struggled to grow its two-wheeler business, registered the ‘Luna’ brand, which was owned by Kinetic Motors. Luna was a popular moped of the 1970s and 1980s but subsequently discontinued following lack-lustre demand.