OEM, dealers to play Santa during year-end for EV passenger vehicles

Carmakers, dealers offering discounts up to Rs 4 lakh

The last 10 days of 2023 are going to be an ideal time to buy electric four-wheelers.

Dealers and companies are lining up heavy discounts, ranging from Rs 60,000 to Rs 4 lakh, for various brands.

The players which are leading in terms of discounts in the electric-vehicle (EV) space are Mahindra and Mahindra (M&M), Hyundai Motor India, MG Motor, and Tata Motors, among others.

Compared with last year’s levels, the discounts are much higher. Last year, those were Rs 2.5 lakh at best.

“The current discounts by all the companies and dealers are huge as far as EVs are concerned. Hence, people may prefer an EV rather than its ICE version. Take the case of Mahindra XUV 400. With prices coming down, many buyers of the Mahindra XUV 300 may graduate to the EV version,” said Vinkesh Gulati, chairman of the academy and research of the Federation of Automobile Dealers Association (Fada).

According to dealers, discounts are higher for M&M and Hyundai Motor, touching even Rs 4 lakh. Interestingly, for the Hyundai Kona, the discount was Rs 3 lakh early this month and when Business Standard contacted a dealer in Chennai, the person said it had increased.     

“The on-road price is around Rs 25.13 lakh for the Hyundai Kona and we are giving a Rs 4 lakh discount, including those of the original equipment manufacturer (OEM) and dealer,” he said.

Earlier this month Tarun Garg, chief operating officer, Hyundai Motor India, had said December was one of the best months for retail.

Select Tata Motors dealers are offering huge discounts on its EV range -- the Nexon, Tiago, and Tigor -- this December. The discounts range up to Rs 2.7 lakh for the pre-facelift Nexon, one of the highest-selling EVs in India. In September, Tata Motors launched a facelift version of the Nexon, and had gradually stopped producing the previous model. Dealers, however, have some unsold stocks of the pre-facelift Nexon. Two dealers -- one in Mumbai and the other in Ludhiana -- said the discounts on this car were Rs 2.6-2.7 lakh if one included an exchange bonus (when a customer exchanges a Tata car for another one). For the Tigor EV, the discounts are up to Rs 1 lakh, while the Tiago EV has discounts of Rs 75,000-80,000.

Nexon sales (internal combustion engine and EV) were hovering at 12,000-13,000 units a month till July, said a dealer of Tata cars. “Then in August there was a slight dip because the company planned a gradual production halt for the older variant, and supplies went down. Moreover, customers were also waiting for the facelift version. From September onwards, sales have been in the 15,000-16,000 range across India. But we have some stocks of the old model in our yards,” the dealer source said.

So, discounts are helping in liquidating the stocks. MG Motor, on the other hand, is seeing discounts of Rs 60,000-1 lakh.

M&M dealers are offering discounts of Rs 3.5-4 lakh on the XUV 400. “We are getting good orders for the XUV 400 now after the discounts,” said a dealer.

Meanwhile, according to dealer sources, M&M is planning to bring in a facelift version of its electric vehicle XUV 400 in 2024. The discounts of the trailing model are thus high at the end.

Fada had noted while releasing the November retail numbers that the passenger-vehicle sector showed potential for growth with year-end offers and discounts expected to stimulate sales. According to a Fada report, in November sales of EVs of Tata Motors were up 61 per cent, those of MG Motor 38 per cent, and those of M&M 492-fold over the same time last year.

“The market faces hurdles in terms of a preference for 2024 manufactured vehicles and a notable slowdown in demand and bookings post festivities. The current PV inventory, still above 60 days, underscores the need for OEMs to strategically reduce dispatches of slow-moving vehicles, especially in the entry-level category. Historically, it is recognised that holding inventory beyond 30 days starts to erode dealer profitability as the financial burden is intensified by the high interest costs of inventory funding from financial institutions,” Fada had said.