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AUTO PUNDITZ

Hybrid Passenger Vehicle Sales Analysis - India

Highlights

  • The year 2022 saw the highest-ever sales of hybrid vehicles, with 19,556 units sold

  • Toyota commands 57% of the Indian strong-hybrid market share, followed by Maruti with 35% and Honda with 7%

  • The Toyota Hyryder Hybrid (9,361) is the best-selling product, followed by the Maruti Grand Vitara Hybrid (6,915)

Indian HEV mass-market

With the entry of the Honda City Hybrid (May 2022), Toyota Hyryder (Sep 2022), and Maruti Grand Vitara Hybrid (Sep 2022), the market size of strong hybrids reached 19,556 units. This translated into a 0.5% market share in the passenger vehicle segment. Strong-hybrid technology is in the early stages of adoption in India but looks promising as a replacement for diesel engines due to the high real-world fuel efficiency of strong-hybrid products as reported by end customers. As a result, strong-hybrid technology will become more mainstream in the coming years.


Strong Hybrids in India: The Past

2008 - Honda Civic Hybrid (CBU)

Not many remember, but the Civic Hybrid was the first strong hybrid car in India launched by Honda in June 2008. In those days, Honda was doing pretty well with its premium product portfolio. The Civic Hybrid was priced at ₹ 21.5 lakh ex-showroom, Delhi, that’s almost twice the price of regular Civic petrol in those days, as it was imported (CBU, or completely built unit) from Honda’s Suzuka plant in Japan.


The car was powered by a 1.3L petrol engine that produces 92 PS, coupled with an electric motor adding another 18 PS, and claimed efficiency above 20 km/l. However, it was heavier than a regular Civic by 80 kg.


Up until October 2008, Honda India could sell only 60 of the total 300 imports in June 2008. So, Honda slashed the price by ₹ 8 lakhs on November 13th, 2008, and was soon able to have fire sales for the next 5 days to clear the entire inventory. Honda has since discontinued made-to-stock imports of the Civic hybrid.

2010 - Toyota Prius Hybrid (CBU)

Toyota introduced all imported third-generation Prius hybrids in India at the 2010 Auto Expo for ₹ 26.55 lakh and ₹ 27.86 lakh, ex-showroom Delhi. Prius had a 1.8L MPFI engine producing 98 PS of power and 142 Nm of torque. It was coupled with an electric motor with a maximum power output of 80 PS and 207 Nm of torque, along with a NiMH rechargeable battery pack.


Toyota was able to sell only 134 units of a fully imported Prius in 2010, and then sales just fizzled as it was very expensive in imported form.


2013 - Toyota Camry hybrid (CKD)

In August 2013, Toyota launched a completely-knocked-down (CKD) production version of the hybrid Camry in India with a competitive price tag of ₹29.5 lakh. Excise duty was also on the lower side (14%) for hybrid vehicles then. The Camry hybrid did well in the competitive segment until 2016. In 2017, the tax rate was raised to 43% under the new GST regime, causing prices to rise by 16% while sales volume fell.


In 2019, Toyota launched the tenth generation of Camry only in a hybrid version at ₹36.95 lakh with a lot more features, and sales gained traction afterward.

2016 - Honda Accord Hybrid (CBU)

In 2016, the 9th generation Accord made a comeback in India in fully imported hybrid form, priced at ₹ 37 lakh. There weren’t many takers for such an expensive sedan, and Honda had to discontinue the Accord forever in 2017.


2020 - Toyota Vellfire Hybrid (CBU)

The official launch of the Toyota Vellfire happened in February 2020, however, Toyota started wholesale of imported units in 2019. It was launched at ₹79.5 lakh in 2020, and in 2022, it costs ₹ 94.5 lakh ex-showroom. Sales have been pretty good ever since; even the Mercedes-Benz V-Class, launched around the same time, has already been discontinued. That says a lot about how great Vellfire is as a luxury palace on wheels. Lexus, Toyota's luxury arm, will soon bring its own iteration of the Vellfire, known as LM, already shown at the 2023 Auto Expo, taking luxury to the next level.

2022 – Localized Hybrid products

Hybrid products in India were expensive, as they came through the full import or CKD route in small volumes. However, in 2022, Toyota and Honda tried to make technology more mainstream by localizing components and making products more accessible to the masses. According to Toyota, the strong-hybrid vehicle is the transition path to fully electric vehicles in India. As it overcomes charging and range-related challenges, the BEV faces in most countries.


Honda City Hybrid

In May 2022, Honda launched the top-end City ZX variant with an all-new strong hybrid drivetrain and also added front camera-based ADAS level-2 features. It was priced at ₹19.5 lakh and has an ARAI-certified mileage of 26.5 km/l.


Toyota Hyryder & Maruti Grand Vitara

These are re-badged products, which essentially means - they have the same underpinning but some different design elements to differentiate. Rebadged products have high back-end cost synergy, and differentiation helps capture a larger market share. Essentially, it is a Maruti product with a highly fuel-efficient, strong hybrid system integrated by Toyota. Both are also available with a 1.5L mild hybrid drivetrain from Maruti with a 5MT, 5MT-AWD, or 6AT gearbox option.


Despite having SUV body styles (higher air drag/Cd value), the certified fuel efficiency of both strong hybrid products is 27.97 km/l. That is even higher than Honda City; however, Toyota’s product price starts at ₹ 15.11 lakhs ex-showroom, thus making it more accessible for Indian customers.

2022 Analysis

  • Toyota Hyryder (9,361) is the best-selling strong-hybrid product, followed by Maruti Grand Vitara (6,915)

  • Honda City was available with three different engine options in 2022

  • Honda City diesel will be phased out in the BS6 RDE phase from 1st April 2023

  • Despite its high price, the Toyota Vellfire is selling pretty well due to its luxurious interior offering

  • Strong-hybrid vehicles now contribute 7% of Toyota’s fuel mix

  • In the case of Honda, despite only having one variant option, it reached 1.5%.

  • In the case of Maruti, it's still low at 0.4%

Why Toyota has a higher hybrid mix than Maruti?

The answer lies in the pricing and positioning of variants. Maruti is cheaper than Toyota when it comes to mild-hybrid variants. Hence, Maruti delivers more value and has a wider reach as well. However, for the strong hybrid version, Toyota offers three variants, thus taking the entry price even lower. Moreover, Maruti has only the top two variants and is priced 50,000 more than Toyota for similar specs and a lower warranty, thus delivering less value, and the Toyota badge certainly is considered more premium than Maruti’s (look at the increasing sales of the Toyota Vellfire). Thus, Toyota is able to sell more strong hybrids, which is their technology fitted in Maruti’s product, due to their ongoing partnership.

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