Emergence of multi-brand car service centres and future trends of automobile servicing in India India’s demand for automobiles has been on the rise of late, with global brands such as MG making their entry into the Indian market. This is observed as a direct response to the increase in car sales in the country over the years, with a 9.5% increase cross annual reports. In 2017, according to the IBEF’s statistics, India boasted the world’s 4th largest automobile industry, with immense scope for growth in the coming years. A new chapter is also set to commence, as India welcomes an ever-growing fleet of electric vehicles into its midst. However, there are issues to address in the sector,
primarily the question of getting cars reliably serviced in the country. These unexplored niches offer a great avenue for business opportunities to flourish in the coming years. The Current Scenario As we step into the new decade, India’s automobile sector is experiencing a boom, turning out to be a major contributor to the country’s economy. Despite the recent criticisms of automobiles’ contribution to poor air quality and pollution in general, the growth has been steady, with the country reaching the seventh spot in terms of commercial vehicle production. On the customer end, an increase in middle-class income has also led to an increase in demand for quality vehicles across a wide diaspora of Indians. Most automobile manufacturers in the country are looking to begin manufacturing on-site in the country, paving the way for a larger base of operations. With more cars hitting the Indian roads, the next question automatically presents itself: What about the post-purchase servicing? Unless the car happens to be a second-hand purchase, most car owners will regularly give their car for service, making the most of the car dealer’s service coverage program. Cars are long-term investments, however, and the service programs don’t last forever. What infrastructure is available for long-time car owners to ensure their car remains in tip-top shape? Though there have been marked improvements over the years, the options available to customers are still very basic.
The initial (and obvious option) is to deliver the car at the official dealership, which is ideally the showroom where it
was purchased. However, this is not always ideal or practical, especially in cases where the car was purchased out of
the station. Additionally, the cost of servicing at authorized dealers isn’t economical per se, especially given rising
prices, which leads us to the next option: neighborhood garages and workshops. Though these outlets are not
authorized, they offer services at far lower rates than most car dealerships, which explains their popularity. There’s a
third player in this arena, however, and that is the innovation called multi-brand car service centres. Many Cars, One Roof Noticing a void in the niche, a few organizations (mainly startups) have risen to the occasion to supply the growing demand. The core concept of such a service centre is that it straddles the middle ground between the affordability of a low-end service garage and the authenticity of an official dealership. These initiatives have been mushrooming in many major cities of India, especially the metros. Service centres such as these are proving to be a blessing in disguise to most car owners, in more ways than one.
– Car servicing in these organizations is entirely transparent and dealings are upfront. This facilitates a streamlined service process for all customers.
– As far as possible, these service centres use only authentic/official spare parts, with original OEMs based on the car’s make and model. Compromise on quality is minimal.
– At the same time, the multi-brand service centres make it a point to offer service rates that are more economical
than official rates. This is partly because of the startup model that most of the organizations follow, as well as due to a more seamless scale of operation and budget management.
– One aspect that proves to be an X-factor for these organizations is the use of contemporary technology. This serves the dual purpose of offering access to car servicing anywhere, even in the event of an untimely
breakdown. The other benefit of technology is the ease of access through smartphones, and the lower operating cost,
which goes without saying.
The market is in a very favourable condition for these multi-brand car service organizations, what with the government introducing programs and initiatives that let automobile makers set up a wider base of operations in the country. All this is leading to a bright future for the Indian automobile industry.
The Path Ahead
– India is set to notch up ₹16.16 trillion through its automotive industry by 2026, according to IBEF.
– The reduced GST from 12% to 5% rate on electric vehicles is set to help the electric automotive industry flourish.
– Due to the favourable market, the multi-brand car service sector is set to grow by 7%.
– The rise of multi-car service startups is going to encourage people to buy cars first-hand, further boosting
the market performance.
The entry of multi-brand car service agencies has been a boon for the Indian automotive sector. Let’s wait and watch to see how the market adapts to these trends!