I am told young people don’t buy cars anymore. Not because they don’t want to, but because they can’t afford them. When I was young(er), it was almost a middle class rite of passage.
You bought a car after your first decent raise. Back then – I am talking about the late 1990s and the early 2000s – people got good pay hikes within the first three years of working. And when they bought their own vehicle, they also entered the tricky world of personal loans.
When your salary zooms up every year, committing to EMIs doesn’t seem that daunting. So, 20 years ago, if a Rs 5000 instalment looked big on a Rs 30000 salary, it didn’t hurt you that much when your salary jumped to forty-five thousand the next year. The wealth effect of growing incomes made the middle class take loans and buy big-ticket durables – especially cars.
The very opposite is happening right now. Also Read Why India's Middle Class is Speaking Up Again ADVERTISEMENT REMOVE AD FADA Data Young people aren’t getting jobs. Those who are, aren’t getting good raises .
White-collar professionals, who have risen to middle management, are stuck with the same salary packages for years. And there is the constant threat of pink slips. In such circumstances, who indeed will dare to buy a car and get stuck with a hefty EMI? Only the minuscule minority, the richest 0.
5 percent of Indians, are getting richer. That is why, over the past couple of years, the sales of luxury cars and multi-utility vehicles have sho.