Though SUV’s may be touted as gas-guzzlers, there is a big market for premium SUV’s in India and the international auto makers are watching the market with high interests.

According to Amish Shah, who is an auto analyst from Antique Broking, "Premium SUVs are still a relatively new concept in India. The market is still very niche. But buyers are warming up to the concept."

The sales figures of premium SUV’s touched 11,000 in 2008, which reflects a jump of around 38% from the previous year. Nevertheless, most of these sales came from the first half of the year. Most of the SUV’s are imported in a fully-built up condition or come to India in a knocked down version.

Car makers hope that buyers will maintain interest with new launches and upgrades. For example, General Motors has launched the automatic version of its Chevrolet Captiva in February, currently available with a waiting period of 65 days.

According to P Balendran, VP corporate affairs, General Motors India, "The lifestyle vehicle segment has been growing steadily over the last few years. I expect about 16,000 premium SUVs to be sold in India this year on the back of better economic sentiment and growing affluence,"

Ashutosh Dixit, general manager – sales, Skoda Auto India, revealed that a company study discovered that most of the premium SUV models available in the country are priced to high, or are too bulky. He said that these factors would be kept in mind when the company would launch the Skoda Yeti SUV in the next year.

According to some car makers, there is a possibility to convert some buyers of mid-sized sedans to premium SUVs. Toyota is planning to launch its new SUV called Fortuner, which will be brought into the country in a knocked down version. The price of the vehicle is hoped to be around Rs 18-20 lakhs with more localized features.

According to Shekar Vishvanathan, deputy managing director, commercial, Toyota India, "Premium SUVs are generally used for inter-city pleasure drive rather than pure commuting. With the roads in the country developing fast, SUVs will be in huge demand going ahead,"

Other manufacturers have also launched SUVs in the premium segment, which include the Q3 by Audi, Santa Fe by Hyundai, XC90 SUV by Volvo, x6 by BMW and X Trail by Nissan. However, price is a crucial hindrance for new entrants as manufacturing SUVs solely out of India is not entirely possible due to low volumes and the prices of premium SUVs remain constantly high.

Nigel Wark, who is the executive director, marketing, sales & services, Ford India, says that entering the mass SUV segment is only possible if localization levels of over 80% are achievable. At present, the premium SUV segment players include Ford, GM, and Honda with premium SUV prices ranging between around 15 lakhs and up to about Rs. 1 crore.

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Posted by Jigar Gondalia on 15 May, 2009 4:47:44 PM IST #