Its destination India for auto majors

Nachiketa Desai
24 January 2002

With the Union government expected to further liberalise the auto sector, these giants are readying themselves to invade the Indian market with their fleet of latest sophisticated vehicles.

Lest these multinational giants wipe them off the roads on their home turf, Indian automakers, too, have begun preparations on a war-footing, promising world-class swadeshi vehicles to retain and strengthen their customer loyalty.

The recently-concluded Auto Expo 2002, in which 150 international exhibitors from China, France, Germany, Italy, Sweden, Czech Republic, the UK, Korea, Japan and the US participated, gave a glimpse of the glistening, gleaming and glamorous vehicles that are revving up to hit the Indian road.

Look at the lineup from the international majors:

DaimlerChrysler: The top-end Mercedes-Benz S Class, E Class and C class, made at the companys Pune plant. The company sold 1,404 Mercs in India in 2001.
General Motors: The company, which sold 2,204 Astras in the upper-end of the midsize car segment and 5,084 Corsas and 724 Swing models in the lower-end of the same segment, plans to introduce at least one new model in India every year. It is considering different model options, including the Opel Vectra and Zafira as well as those from its affiliate like Subaru, a maker of all-wheel-drive vehicles. The Chevorlet Cruze, a compact hatchback, which GM has jointly developed with partner Suzuki Motor in Japan, could also be an option.
Ford: The maker of the upper-end midsize cars Ikon and Mondeo, Ford plans to expand its portfolio under the Ikon series. It has a domestic collaborator in Hindustan Motors, which will make engines for the Ikon series. HM will make 20,000 engines annually.
Fiat: Riding on the success of its flagship product Palio, the Indian subsidiary of Italian auto giant Fiat SpA will launch a sporty variant, Sport, and a limited signature edition, S10, of the premium small car next month. It is rolling out two new versions of the Palio Weekend and Aventure by the yearend. The company has already sold 8,000 Palios since its launch in 2001 and is targeting to sell 50,000 cars in 2002. It also makes the upper-end Siena in two versions.
Toyota: The maker of the multipurpose vehicle Qualis plans to import completely-built units of the land cruiser Prado and Camry in limited numbers into the country soon. It is also planning to launch an India-specific premium midsize sedan next year, based on the popular Corolla car platform. The company plans to target the premium-car segment with the launch of the petrol version of Qualis, which has sold more than 50,000 units since the launch, cornering 40 per cent of the MPV market.
Hyundai: The maker of popular brand Santro in the small-size segment, the medium-size Accent and the upper-end Sonata, the Korean car major is all set to expand its premium range with its five-door affordable Ferrari, Tuscany and the sports utility vehicle Terracan. It is also considering the launch of Matrix, a car bigger than Santro.

Will the Indian auto market be completely swamped by these MNC giants, driving the indigenous automakers out of business? Not likely, as long as the public sector Maruti Udyog and the Tata Engineering continue to dominate the small and medium-size segments, which constitute the lions share of the Indian auto market.

Seeing no reason for complacency, the Indian automakers are readying themselves to add new product folios, with a view to prevent the MNCs from eating into their market-share.