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Indian luxury car market set to register a record 40% decline in 2020

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MUMBAI: The Indian car market may be witnessing a sharp turnaround, driven by strong demand for entry-level models, but the story isn’t pretty when it comes to the luxury segment.

The Indian luxury car market is bracing for its steepest recorded decline in 2020, with the industry estimating sales to fall as much as 40%, pulling it down to the levels of 2011. While Covid-19 has led many middle-class families to opt for personal mobility, triggering demand for entry-level cars, the impact of the pandemic on the economy and businesses has forced wealthy individuals and companies to cut down on discretionary spending, such as on luxury vehicles.

Sales had fallen 35% during the January-March period, while much of the following quarter was lost due to Covid-19 and the lockdown. Industry insiders said sales so far were down 50-55% from last year. They hope some support would come from festive demand.

According to several people in the know, only 10,000-11,500 luxury cars were sold in the first eight months of 2020. The only glimmer of hope is, with the unlocking, there is a month-on-month recovery in sales across luxury car brands. Yet, the industry at best may deliver sales of 21,000-22,000 units compared with 35,000 units in 2019.

The market leader, Mercedes-Benz, said there was a sequential recovery in monthly sales and that the maker of the S Class had reached 60% of pre-Covid levels in July and August. However, for the full year, it expects the market to decline by more than 40%.

It will take at least two to three years for the market to recover the lost volume, Mercedes-Benz India managing director Martin Schwenk said. “The sales recovery is steady with 20-25% month-on-month growth for July to August … We see now a growing momentum with customers starting to ‘unlock’ and to look forward to the festive season. We will try to reach close to last year’s festive season volume,” added Schwenk.

Despite having a large number of millionaires, the penetration level of luxury cars in India is considered to be among the lowest in large economies. The share of luxury cars in the overall market, in fact, has come down from 1.2% in 2019 to about 0.9% now. Industry executives expect sales to start growing only in 2021, that too because of comparison with the low numbers of this year.

Audi India head Balbir Singh Dhillon said the automotive industry had lost significant volume during the pandemic, which was not recoverable this year. He is hopeful of a recovery next year.

Interestingly, his company registered the highest ever sales of its Audi A6 sedan in August, having launched the vehicle in October of 2019. “What that tells us is, while the pandemic is far from over, there is a growing optimism among buyers and this is translating into sales on the ground,” Dhillon said.

With the evolving market situation and the addition of new products, luxury car makers like Audi and Volvo expect increased footfalls in showrooms. Close to a dozen new products are likely to hit the roads across luxury car makers this festive season.

Volvo Cars India managing director Charles Frump said he was optimistic on the festive season and expected demand momentum to accelerate in the coming months.

“We are cautiously optimistic and hope for growth in 2021. We are coming up with exciting products in addition to capturing the pent-up demand through various initiatives. We expect to get back to 2019 levels or thereabout in 2021,” added Frump.

The local units of Jaguar Land Rover and BMW did not respond to emails seeking comment.

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Tencent and Chinese automaker Geely team up on smart car tech

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Logo of Chinese automaker Geely Auto.

Zhang Peng | Getty Images

China’s Tencent has teamed up with automaker Geely on various car technologies as traditional vehicle manufacturers continue to partner technology giants.

The deal will see the two work on areas “in the fields of digitalization, intelligent cockpits, autonomous drive, and low carbon development,” the companies said.

This will include making the development cycle of a car more digital, adding smart applications to the driver’s cockpit, and eventually exploring autonomous driving systems.

Tencent has a cloud computing division and develops artificial intelligence applications, which could be useful when it comes to the auto sector.

Geely has been looking to boost its tech prowess through partnering with major technology firms.

This month, Baidu created a standalone electric vehicle company with Geely as a minority shareholder that will be responsible for manufacturing.

Meanwhile, Apple iPhone supplier Foxconn and Geely created a joint venture aimed at selling manufacturing and services to the global auto industry.


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EV start-up Rivian raises $2.65 billion in new funding round led by T. Rowe Price

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Rivian, the electric vehicle start-up backed by Amazon and Ford Motor, on Tuesday said it closed on a $2.65 billion investment round led by T. Rowe Price funds as the company moves closer to production of an all-electric pickup and SUV.

The company has raised about about $8 billion since 2019. Rivian closed on a $2.5 billion investment round last year, also led by T. Rowe Price; a $1.3 billion funding round in December 2019; and had raised at least $1.5 billion before that.

Other participants in the round included Fidelity, Amazon’s Climate Pledge Fund, Coatue and D1 Capital Partners as well as several other existing and new investors, according tot he company.

Rivian is expected to be among the first, if not the first, to bring an all-electric pickup to market later this year.


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MG Hector vs Jeep Compass: 2021 Facelift showdown

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NEW DELHI: The 2021 MG Hector facelift was launched recently and its key rival, the 2021 Jeep Compass facelift was also unveiled parallelly. Both the SUVs have taken their duel to a different level right at the beginning of 2021. While both the SUVs avoided a plethora of changes in the new facelift, they do come with a couple of prominent changes to enhance their appeal.
TOI Auto takes a look at both the rivals to see which one comes out on top, at least on paper, and based on the new additions, which one actually deserves a spot in your garage.

Price
Starting off with the key factor, the 2021 MG Hector facelift is priced between Rs 12.89 lakh – Rs 18.32 lakh (ex-showroom). Keeping the current competition in mind, the Hector facelift has been priced very aggressively. The MG Hector facelift is available in 4 variants – Style, Super, Smart and the range-topping Sharp.
While the Jeep Compass facelift’s launch is awaited on January 27, it is expected to start somewhere around Rs 17 lakh (ex-showroom). The 2021 Jeep Compass facelift might be offered in 5 variants- Sports, Longitude, Limited, Limited (O) and a new S variant.
Engine
Both the SUVs were upgraded to meet BS6-compliance in 2020 and the engine options have been carried forward to the 2021 facelifts without any changes.
The MG Hector facelift comes with 1.5-litre turbo-petrol (normal and hybrid) engine and the 2.0-litre turbo-diesel engine. The same goes for the 2021 Jeep Compass facelift as it carries over the previous 1.4-litre multi-air petrol engine and the 2.0-litre multi-jet diesel engine. The diesel engine are in fact shared between the two.

Changes: MG Hector facelift
Starting with the MG Hector, the facelift manages to retain its sporty yet urban character and the most prominent change comes in the form of its front fascia. Along with that, there are some minor improvements in terms of creature comforts, interior styling and the connected in-car tech.
The MG Hector retains its original silhouette but the new visual additions like the redesigned signature front grille, gunmetal skid plates, new 18-inch dual-tone alloy wheels, add to the bold character of the SUV. The Hector also comes with an enhanced rear-profile as the tailgate comes with a dark garnish adding to the aggressive styling of the SUV.

When it comes to tech, the Hector facelift gets the latest version of iSmart connected tech and features like Hinglish commands and external Wi-Fi connection ability are expected to strike chords with the audience. On the inside, the MG Hector facelift greets you with new dual-tone champagne and black colour scheme and the ventilated front seats, wireless charger and auto-dimming IRVM also improve the in-cabin experience.
Changes: Jeep Compass facelift
The changes in the 2021 Jeep Compass are much bigger in magnitude as the SUV comes with a completely refreshed exterior, interior and also comes with a few new features to enhance the in-cabin experience.
On the outside, the Compass facelift retains its silhouette but flaunts a completely redesigned front fascia. New reflectors with LED projectors, seven-slot front grille, trapezoidal wheel arches improve the overall image of the SUV.

Step inside the Compass and you’ll find a quite spacious interior compared to the previous model. The mid bolster piece with a metal brow, fluted shapes and clear lines add to the elegance of the cabin. The new dashboard design makes the SUV appear much more modern on the inside. The ventilated front seats, 10.1-inch screen, sunroof improve the in-cabin experience too. Keeping it at par with its rival, the Compass also enhances its Connected prowess with the new UConnect-5 system.


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