WITH the average pricing of a washing machine on the decline every year, the first half of 2003 did not bring much reason for cheer to the consumer durables industry.
According to ORG data, the washing machines industry grew by a marginal 0.9 per cent in the period January-June 2003 in value terms. The growth, however, was 6.5 per cent in volume terms for the same period.
“The reason for the low value growth in the first six months can be attributed to the fact that there was price erosion of 12 – 15 per cent in the washing machines segment during the period,” says Mr Ajay Sharma, Product Head (washing machines), LG Electronics India.
While the first half of the year did see considerable reduction in price, erosion of price has been a feature for the category over the past few years.
Points out Mr R. Zutshi, Director, Samsung India, “In the last couple of years prices of washing machines have come down by an average of 5 to 6 per cent every year.
The value growth is lower in the washing machine market primarily on account of the price realignment that has been done by white goods to grow the market and garner volumes. It is also a fact that the semi auto (SA) segment still constitutes a good 76 per cent of the market and the value growth this segment has shown in the first half is a mere 0.8 per cent.”
The volume growth, however, in the same segment (semi-automatic) was 8 per cent.
The fully automatic (FA) segment, which accounts for a lesser share in the washing machine segment, saw double-digit growth both in value and volume terms.
The segment grew by 11 per cent value wise, and 15.8 per cent volume wise in the first half of the year.
Meanwhile, according to the data, Korean consumer durables major, LG Electronics, got the top slot in the washing machines segment in the first half of 2003, growing by 38.9 per cent to garner a market share of 24.3 per cent (value-wise).
It was followed by Whirlpool with a market share of 18.2 per cent and Videocon with 14.4 per cent market share.
Though the washing machine market may not be showing much growth, durables companies have already started sprucing up in view of the approaching festive season. Apart from coming out with aggressive promotional marketing campaigns, companies are also rolling out newer products with an eye on the replacement market.