Car subscriptions are rising among transit professionals in tier one metros, says Partho Banerjee, Senior Executive Officer, Services, MSIL
Maruti Suzuki India Ltd. (MSIL) witnessed significant traction in its car subscription model in FY24, said Partho Banerjee, a senior company official.
There were more than 10,000 cars across India of all MSIL brands put together since subscriptions were introduced in July 2020 till the close of FY24.
Post-pandemic recovery
While the COVID-19 pandemic hit uptake severely, growth has been steep in the past couple of years.
Subscribers are mainly those who are in India on short-term projects or engagements for under two years. But young professionals who increasingly believe in shared services and do not prefer to own assets are also opting for the subscription model, Mr. Banerjee said.
“We saw good traction for the subscription model last year. The growth in the subscription model was 44% over FY23,” Mr. Banerjee, told The Hindu.
‘Popular overseas’
While the subscription model was a new concept in India, it was already popular in the United States and other mature markets, he observed.
This model may take some time to find greater acceptance in India, because people still consider owning a car as an investment, he added.
“But subscription is certainly an option we offer to our customers. Generally, in mature markets people tend to go for the subscription model. In India, we are seeing interest among young customers,” Mr. Banerjee observed.
This model is hassle free, without requiring a loan and customers could return the car, or upgrade after the tenure period.
He said the trend was evident in Hyderabad, Delhi and Bengaluru and other metro cities where there were large numbers of transit professionals.
