[badtman]

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 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 4x4 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.

[Dr.AD]

Originally Posted by badtman

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.

Very interesting analysis and very good first post! Welcome to the forum.

The "Valley of Depression" is something quite true and felt by anyone who is looking for a car around 25L price range. However, I would not agree that this is the range of 10L to 25L as you have shown. The true Valley of Depression is 20L to 30L. There is a total dearth of choices between 20L and 30L. Even in your plots, you see multiple minima between 25L to 30L. That is the true Valley of Depression!

I am taking liberty to use your plot but with what I see as the true Valley of Depression:


This is the True Valley of Depression!

Further, if someone is looking for sedans, then the choices come down drastically. And when it comes to SUVs, again, if we make a stricter definition of "4x4/AWD SUVs" (I am a firm believer that a SUV has to be 4x4 or AWD), then even in the SUV segment the choices reduce drastically. Thus, for someone like me who will consider either a sedan or else a 4x4/AWD SUV, the "Valley of Depression" is much worse than what your plot shows :-)

It will be interesting to do this analysis specific to body styles such as hatchbacks, sedans and 4x4 SUVs.

[lonetraveller89]

With the increasing fuel prices and availability of taxi services, a city-dwelling, rational Zoomer would analyse the phase in which he doesn't need an automobile as "Peace of Mind".

[badtman]

Originally Posted by Dr.AD

The true Valley of Depression is 20L to 30L. There is a total dearth of choices between 20L and 30L. Even in your plots, you see multiple minima between 25L to 30L. That is the true Valley of Depression!

Thank you for your kind remarks. I do believe you are correct about the 20L to 30L bracket. It was my total inexperience in this price bracket that caused me to overlook it.

Originally Posted by Dr.AD

It will be interesting to do this analysis specific to body styles such as hatchbacks, sedans and 4x4 SUVs.

Below I have attached some more graphs according to body-styles.
Hatchbacks



Sedans



SUVs

[DicKy]

Great thread idea and analysis too.

Every time we whine about the prices or choice of brands/vehicles in India, we tend to forget that our market is unlike most others and the price ranges of vehicles available reflects that.

https://www.team-bhp.com/forum/india...ml#post3483453 (Cars we wish manufacturers would launch in India)

Here is a post I wrote seven years ago.
Though the price points have changed, from 10-12 lakhs to 15-18 lakhs nowadays, basic premise remains the same.
We got one of the widest choices of cheap cars in the planet (don't know about China). While the customer expectations, affordability, taxes and all contribute to us getting unsafe cars, that's a topic for another discussion.

So at prices where rest of the world buys used cars, we get to buy a brand new car.
But then in most other markets, the real choices start from 15-35 lakhs. Whereas for us in the 20-30 lakhs segment or 30-40 lakhs segment we may get models that could be counted with our fingers.

Add to that, jumping from one segment to another takes a big hit to the pocket, while in most other markets, segments overlap each other heavily.

Ofcourse one could say that we are spoilt for choices in the 8-20 lakhs segment. But the fact is if we zoom out, we could see that looking at different bodystyles and vehicles we do have less choices overall.

[girishglg]

Originally Posted by badtman

2) Cliff of Rising Action
Attachment 2119004

Congrats on your first post and a wonderful one there. A very interesting analysis there bunching up the price points to the choice of cars/ SUVs in our market.

One thing that stands out is that customers nowadays tend to classify a cheap car to the second segment rather than the entry level segment (traditionally considered as A segment) with reference to price point. That is upto 5 lakhs is not a major consideration and would this be because of rising purchasing power or aspirations is a question.

This shift may be one of the main reasons for the failure of the Nano as the benchmark of a car in our country may be itself higher given the prestige or comfort value. A thing to ponder.

[saikarthik]

A very good thread, and analysis.

But the reason for less choices might be driven by the consumer preference and volume trends. If the car of say 20-30 Lakh has very less takers, the options will be limited as not every manufacturer would like to put their finger in this segment. Note that many of the wants will attract higher tax, so only those who can comfortably spend will do in this segment.

Another aspect of the choices in popular segment will lead to great pricing/quality due to competition, but also see rebadging and re-skin variants.

[badtman]

Part 2: Going Back to The Past

Some very interesting points have been brought up by our fellow BHPians, and so I thought it would be nice to delve a bit further into the matter.

Originally Posted by DicKy

Here is a post I wrote seven years ago.
Though the price points have changed, from 10-12 lakhs to 15-18 lakhs nowadays, basic premise remains the same.

Inspired by your post, I went and dug out an old Autocar India magazine I had lying around. It was a March 2015 edition with a Renault Lodgy on the cover with the caption "Watch out, Innova!". Well, we all know where that went, but anyways, it had what I sought. The nice 'Buyer's Guide' at the end providing a very good insight into the prices of yesteryear.

I used it to create a price database similar to the one I made for this post.
The cars highlighted in red are no longer on sale, and that highlights how much the car scene has changed over the years!

The Car Consumer Choice Index - 2015

Some similarities and differences are immediately apparent from this chart, like the shift in the peak of choices and a similar overall shape. But for a better understanding, I have attached a comparison chart for 2021 and 2015 together. Let's take a look into that and analyze how things changed through the years.

The Car Consumer Choice Index - 2021 and 2015

Observations:
1. The total number of cars in the 1-50L bracket is 96 in the year 2021 while it was 114 in the year 2015.
2. Thus the number of choices offered was significantly higher with the peak touching 33 cars in 2015 compared to 25 in 2021.
3. The prices at the peaks are relatively similar in both 2015 and 2021, within the 8-9L bracket.
4. The number of choices in 2021 compared to 2015:
a) Choices remain relatively stable in the 2-6L bracket with prices showing a slight increase
b) Choices decrease substantially in the 6-9L bracket
c) Significant increase in the 9-11L bracket highlighting the premium pricing
d) Choices show a dip after 23L, signifying a shift in the automakers' priorities regarding India

I hope these charts help gain some clarity on the shifts in the automobile sector, and the general trends prevailing in the Indian market! Cheers!

[warrioraks]

Originally Posted by badtman

Part 2: Going Back to The Past
Some very interesting points have been brought up by our fellow BHPians, and so I thought it would be nice to delve a bit further into the matter.

Welcome to the thread. You landed with a bang.
Looking at your first post, I was thinking it would be very interesting to see time shift of the data across decades. I scrolled down and saw the lovely analysis comparing 2015 and 2021. The similar valleys of depression across a span of 6 years has me wondering whether the 10 lakh (1 million) price point is a psychological barrier for middle-class Indians. I know when I was in the market for a new car, 10 lakh was the upper cap I had in mind.

Considering as a country, the salaries and growth haven't been fabulous over the last few years, maybe it will take another economic boom for the customer choice to move beyond this imaginary wall on 8-12 lakh range. Just my 2 paise!

[batladanny]

Lovely article. The comparison with 2015 is especially interesting to see. Obviously inflation has played its part in moving the chart rightward. The surprising part was seeing that there were surprisingly more options available from 22L onwards compared to today. Didn't expect that.

Another thing that would be fun to see is the comparison with say 2010 — before the 4m regulation was introduced. I guess the graph would have been much flatter then with more options at mid-high price points.

[sharninder]

Originally Posted by warrioraks

The similar valleys of depression across a span of 6 years has me wondering whether the 10 lakh (1 million) price point is a psychological barrier for middle-class Indians. I know when I was in the market for a new car, 10 lakh was the upper cap I had in mind.

It definitely is a barrier. When I was in the market for a car 6-7 years back, 10 lakhs for the upper limit for me and I got my Ecosport for 9.2. I remember I didn't opt for the Optional pack just because it was going very slightly over 10. Within that 10 lakh bracket I looked at everything from Sedans to SUVs.

[Dr.AD]

Originally Posted by badtman

Part 2: Going Back to The Past

Observations:

1. The total number of cars in the 1-50L bracket is 96 in the year 2021 while it was 114 in the year 2015.

Very interesting data again. Thanks for sharing this.

It is very surprising to see that the total number of cars are fewer in 2021 than in 2015. I would have never thought of that. With so many new launches, especially so many new CSUVs around, it is hard to believe that there are fewer total choices now.

Also, what is even more surprising is that in the higher price segment (say 30L+), your plot shows that there are fewer choices now than in 2015. With so many models now available from BMW, Mercedes, JLR, Lexus, Volvo (just some names for example) and also so many other models pushing in the 30L+ category now (Again just some example: BMW 2-series, Audi Q2, BMW X1, VW Tiguan, Skoda Superb- all pushing into the 30L+ range now), I would have thought we have lot more choices here. Further, there are many models now available in the 30L+ range which are imported CBU under the 2500 quota which was not there in 2015. Given all this, the plot in the 30L to 50L range is very counter-intuitive.

Are you sure you have the complete data of all models available in India in the above plots? Is some data missing by chance? If this is indeed the complete data, then this is a very interesting discovery!

[AutoDowntowner]

badtman,
Many thanks for such a wonderful analysis. This is very unique.

[Sabrish]

Great post to begin with!! Good insights too..

The CSUVs are a little crowded and consumers are spoilt for choice! Making it quite competitive. But in reality its 50% of the original products and rest are alter egos from the same parent..Kia/Hyundai, Maruthi/Toyota, Skoda/VW etc... Like the BBK of mobiles (Oppo, Vivo, Realme, Oneplus, Iqoo etc) I beleive thats a good strategy to increase the penetration without being loud

The sedans and the Premium Sedans are the segment which seems to be dying from a choice perspective and also a buying index perspective. While saying this I opt out the sub 4M Sedans....

I hope the chart gets distributed evenly over a period of time to have a wide spread option and not over crowd in one segment...

Now with the EVs coming in the dynamics of the chart could completely change...Like a Hatch being in the spread from 4-12 lacs etc...

Good one and thanks for sharing!!

[badtman]

Originally Posted by Dr.AD

Very interesting data again. Thanks for sharing this.

Also, what is even more surprising is that in the higher price segment (say 30L+), your plot shows that there are fewer choices now than in 2015. With so many models now available from BMW, Mercedes, JLR, Lexus, Volvo (just some names for example) and also so many other models pushing in the 30L+ category now (Again just some example: BMW 2-series, Audi Q2, BMW X1, VW Tiguan, Skoda Superb- all pushing into the 30L+ range now)

Thank you, once again! I assure you that I have tried my best to have the complete data of all models available in India.
The data could seem surprising at first, but if we look at the cars that have left the market over time, it might start to make more sense.

• Audi A3, Audi Q3
• BMW 1 Series
• Hyundai Santa Fe
• Mercedes-Benz A-Class, B-Class, CLA-Class, GLA Class
• Renault Koleos
• Volvo V40