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Old 27th June 2012, 12:15   #46
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Great thread GTO. Love the clarity of your posts.

I agree with most of the points where the C2 sedans are starting to match the D1 segment cars in most aspects and in some areas even trumping them. The only area where I feel the D1 sedans still hold the edge and will continue to do so is the luxury symbol. The sunny may offer you the same space and comfort as the Altis but it goes without saying that I would rather want to arrive in a Altis rather than a sunny, ofcourse given that I can afford to do so. Having said that its quite clear from the sales figures that this factor alone cannot push the sales of D1 sedans more than it already is.

The buying power of the customer is ever increasing and as a result today many of us would not even give the 3 series a passing look since its become such a common, regular joe kind of a car. Compare this to the scenario just 5-6 years back when even spotting the bmw badge used to be such a mouthwatering experience. Right now the D1 segment cars have lost that exclusivity which they held earlier. That luxury symbol has now shifted to the D2 segment cars. So as you rightly said to compete and maintain respectable sales numbers the first thing that the D1 segment cars need to do is to start offering a lot more than they already do, with the prices staying the same. This will bring back a lot of D2 segment customers back to the D1 segment cars, similar to whats happening between the C and D1 segment right now.

But then would the car makers be interested in doing so? I don't think so. The C segment is there bread and butter segment with a huge market which is going to see further growth and hence they are regularly updating these models to stay competitive. And for all those customers wanting to experience real luxury they have the D2 segments and then the germans to splurge on.

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Old 27th June 2012, 12:35   #47
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Wonderful thoughts and analysis GTO
My thoughts:
First and foremost, Car manufacturers need to spice up the D1 segment cars to make them more appealing for the buyers and they need to bring some exclusivity into the segment. There are a lot of people in the market who crave for exclusivity. That's the exact reason why BMW and Audi and the like are on a steady sales curve (add their brand value to the equation).

Another thought that strikes my mind is, it's just not the D1 segment! (Correct me if I am wrong) The SUV (typical ladder frame) market has also taken a beating due to the new and jazzy monocoque models that have come out. All manufacturers have started to think - "Monocoque, Soft-Roader/Compact SUV with all bells and whistles attached; we have a winner!"
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Old 27th June 2012, 12:47   #48
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

I'm not sure if someone has mentioned this earlier but the way I see it is a little different.

The C2 segment sedans have actually invaded the D1 space. Prices have gone up over the years and as a result the prices of some of C2 segment sedans are almost what one would pay for a D1 sedan earlier. Case in point the Altis. The Altis when launched was available at 13.5L on road with all bells and whistles. The fluidic Verna petrol fully loaded is just around a lakh lower now.

The D1 segment has also gone up with the Altis now costing 16L+.

The Honda City, Fiesta, Verna, Vento, Rapid make up the C2 space which goes upto the D1 bracket and the C1 is a new segment that has replaced the older C segment.

If my budget was 15L I would look at the Altis, Civic and Laura but now 15L will get me a fully loaded Verna, Rapid, Vento, City with some cash to spare. One would need to stretch by 2-3L more for a Laura, Altis or Civic.

Basically the Altis, Civic, Laura and Cruze are struggling as they have moved up half a segment into territory that is neither here nor there.
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Old 27th June 2012, 14:40   #49
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Quote:
Originally Posted by Vid6639 View Post
I'm not sure if someone has mentioned this earlier but the way I see it is a little different....
What you said makes absolute sense. But there could be another factor at play here as well.

For a majority of people, rising incomes have ensured that they can now consider the C2 segment. And maybe because the number of such people is now significantly higher as compared to those who can target D1(I'm assuming vehicle manufacturers have enough data to understand this trend), so the competetion and the choices (in terms of models, and equipment levels) in C2 segment grew at a much faster pace compared to D1.

Perhaps with the passage of time and if the economy picks up pace again, we might see the action moving to D1 in 5 years or so. This seems all the more true looking at how the action moved to premium hatches(swift, i10) 5-7 years back, and then the C1/C2 category subsequently.
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Old 27th June 2012, 14:52   #50
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

I have a few points to add:
1. Road space: As much as our cities are growing and so are people's wallets, everybody wants to go for a car nowadays. Given the cramped condition of our roads, it makes sense to buy a smaller car with great features. Imagine taking a U-turn with a D-segmenter on our crowded roads!

2. Parking space: People don't have parking space either in their homes or on the streets. A BIG car will only make matters worse.

3. Shift in mentality (towards being more practical): Contrary to what people used to think 10 years back, a BIG car is not the only way you could show off your prosperity. People think more practically nowadays. Precisely why cars like i20 Asta CRDi have lot of takes in spite being so expensive.

4. Increasing drivers in the family: Nowadays, since everybody in the family know to drive and wants a car, it makes sense owning couple of C2 -segmenters or may be three B2-segmenters instead of owning one big D-segmenter.

Last edited by blue_pulsar : 27th June 2012 at 14:58.
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Old 27th June 2012, 15:42   #51
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Quote:
Originally Posted by Vid6639 View Post
If my budget was 15L I would look at the Altis, Civic and Laura but now 15L will get me a fully loaded Verna, Rapid, Vento, City with some cash to spare. One would need to stretch by 2-3L more for a Laura, Altis or Civic.

Basically the Altis, Civic, Laura and Cruze are struggling as they have moved up half a segment into territory that is neither here nor there.
What you said is true but isn't it applicable across the board? In simple words people have got increased demands now and the moolah to meet those. The overall % of sales should have remained similar since even the C segment sedans would have lost a whole block of buyers who had around 7-8L Rupees to spend on a car. That amount would have got them a C segment car till some years ago but now they would have to be contend with an entry level sedan or a hatch.

But what we are seeing here is step motherly treatment shown by most car makers towards the D1 segment cars. They do not offer anything special, have no tag line to themselves. So for most buyers its either the C2 segment fully loaded sedan or a proper D2 segment sedan.

Quote:
Originally Posted by avisidhu View Post
Perhaps with the passage of time and if the economy picks up pace again, we might see the action moving to D1 in 5 years or so. This seems all the more true looking at how the action moved to premium hatches(swift, i10) 5-7 years back, and then the C1/C2 category subsequently.
+1.
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Old 27th June 2012, 16:09   #52
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

The C1 class was a neglected lot a few yrs back and all the action was in the hatchback. The turf has changed in the last 3 yrs with the advent of VW and Toyota thereby disrupting the Honda dominance in that category.

I think that D1 segment will see action in it own time. After all the laws of nature are applicable in automobile industry as well !!
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Old 27th June 2012, 16:31   #53
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Brilliant discussion!

I guess the problem is that D1 segment simply doesn't bother to improve their product and match up with competition, or they didn't realize the competition is not really from their competitors but from segments below and above

If you notice, There is a continuum of improvement across segments, except the D1 segment. Hatchbacks have features that match or go beyond C1 and C2 (i20 anyone?), C1 segment cars match up quite well with C2 in certain parameters (Etios, Manza, Sunny), and C2 has more features than the D1. But this continuum is broken with the D1. The Corolla is as bland today as it was before. Every car in the segment is either boring or old or both.

This 'segment war' is actually faced by every segment, but others were quick to react and saved themselves. I can have the same 8 lac rupee budget to decide between a sedan and a hatchback that offer the same features. This was unthinkable a few years ago.
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Old 27th June 2012, 22:16   #54
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

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Originally Posted by veyron_head View Post
Brilliant discussion!
I can have the same 8 lac rupee budget to decide between a sedan and a hatchback that offer the same features. This was unthinkable a few years ago.
Wonderful point this. It fully reflects how much we have matured as a car market over the last 5-6 years. Remember the Chevy Srv? Nice looking loaded hatchback launched for a C+ segment money and how it failed. If they had launched it now, it would have been a roaring success.
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Old 27th June 2012, 22:30   #55
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

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Originally Posted by apachelongbow View Post
Wonderful point this. It fully reflects how much we have matured as a car market over the last 5-6 years. Remember the Chevy Srv? Nice looking loaded hatchback launched for a C+ segment money and how it failed. If they had launched it now, it would have been a roaring success.
With that petrol engine, it probably would have still failed. If it came with the optra's diesel engine then yes, I would buy it.
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Old 28th June 2012, 10:43   #56
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

A thought just occurred to me : Things are so bad in the D1 segment that Honda hasn't even bothered to launch the new-generation Civic! This is unlike Honda which refreshes its Indian lineup immediately upon a global debut.

But Honda continues to flog a dead horse. It knows that the next-generation Civic isn't going to make any difference at all.
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Old 28th June 2012, 11:00   #57
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Quote:
Originally Posted by GTO View Post
Honda continues to flog a dead horse. It knows that the next-generation Civic isn't going to make any difference at all.
Why should they. The City is doing just decent (not great) volumes and that too inconsistently. Then there is VFM XUV5OO to deal with. I think Honda is doing sensible thing by not spending too much on marketing of Civic as they already know it wouldn't turn into volumes. But saying that, isn't that also true that Honda SEs themselves are moving customers away by informing that refreshed/facelift version is due 'soon'. I have personally experienced that. Or am I missing something that refreshed version is already launched (with free Caska unit) as it has been too long.
OT
PS:Requesting to start a new thread on 'Is it worth buying a New Car after the horrible experience meted out at new car dealerships of almost all manufacturers'.
I have had hopeless experiences in Goa while buying the T-Jet and same story repeated 1-2 weeks ago when we took delivery of XUV in Mumbai. I can see your as well as of so many Bhpians experience while delivery of New car. Few dealers try to cheat too. Hence this request.

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Old 28th June 2012, 11:15   #58
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Quote:
Originally Posted by GTO View Post
A thought just occurred to me : Things are so bad in the D1 segment that Honda hasn't even bothered to launch the new-generation Civic! This is unlike Honda which refreshes its Indian lineup immediately upon a global debut.
I would not blame Honda for this. Everyone knows that regardless of how good the new civic or anyother car is going to be, the one thing it needs to sell is a diesel heart. People are just not willing to go through the mental agony of rising Petrol prices every month and the dismal FE figures returned by this sedans. More so when almost all cars in this segment come with a diesel sibling too. And a customer wanting to spend 15L on a Car has no issues in rather paying 16L and buy the diesel sibling which guarantees him that "priceless peace of mind".
Honda needs to get diesel engines ASAP. Its a losing battle otherwise.

Quote:
Originally Posted by carwatcher View Post
PS:Requesting to start a new thread on 'Is it worth buying a New Car after the horrible experience meted out at new car dealerships of almost all manufacturers'.
Wouldn't that would be a mere rhetorical thread? People are fed up of most things in India right from Paying your taxes, bills to buying a car. Everywhere there are unprofessional people who make your experience sour. But at the end of the day you need to do what you need to do. At most you can just go ahead and get your car from a different dealer/different automaker. Choose the one which is the least offensive. Something similar to what we do while voting....
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Old 28th June 2012, 11:34   #59
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

Quote:
Originally Posted by GTO View Post
A thought just occurred to me : Things are so bad in the D1 segment that Honda hasn't even bothered to launch the new-generation Civic! This is unlike Honda which refreshes its Indian lineup immediately upon a global debut.

But Honda continues to flog a dead horse. It knows that the next-generation Civic isn't going to make any difference at all.

Isn't this because, the new generation Civic is not a success in other markets, and Honda themselves has committed to revamp that design and launch again?
I would say, we need to appreciate Honda in not dumping a known non-successful version in our market and rather wait for the rectified version to take it in.
Diesel mill can be the reason done till then.
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Old 28th June 2012, 11:56   #60
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Default Re: The Diminishing Value of D1 Segment Sedans (Altis, Cruze, Civic, Laura et al)

I feel the D1 segment has been neglected by most of the manufacturers. Jetta which is probably the latest launch of all cars doesn't even come with ACC on the top-end variant whereas the Vento highline offers this. I don't know who approved the equipment list for the Jetta, but VW needs to find a better person for it. How can you explain absence of ACC(Jetta), steering mounted controls(IIRC,Laura) on cars costing 18-20l when hatchbacks have these features as standard.

However, the D1 segment cars have one advantage over the C1 and D2 segment cars, they are more luxurious than the C1 segment cars and not too big to drive and park within the city like the D2 cars. If the manufacturers refocus on the D1 segment cars, they can surely put them back in the game.
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