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New wheels on the block

india Updated: Jun 22, 2013 02:11 IST
Sumant Banerji
Sumant Banerji
Hindustan Times
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When in trouble, add some frills and tweak them anew. With the domestic automobile industry battling a protracted slowdown in demand, it is looking to new cars to help tide over the crisis, with a flurry of launches in the lead up to the festive season.

Starting with the new Mercedes E class, one of Merc's better selling models in India, and the long awaited compact SUV Ford EcoSport next week, over a dozen new models are expected to be launched during the rest of the year.

These include two small cars from Maruti, a compact hatchback from Hyundai to rival the Swift, the re-entry of Skoda's Octavia, SUV giant Jeep's entry into India, and the 1 series — BMW's answer to Mercedes' A Class. With high discounts failing to cheer the market mood, carmakers are praying that launches would do the trick and spur demand.

"Discounts do not give additional sales but only help advance decisions of customers who would have bought cars anyway," said Pradeep Saxena, executive director, TNS Automotive. "It is a new car that attracts the customer who would not have otherwise bought a car. The potential for growth is more with a new car."

In 2012-13, car sales declined for the first time in over a decade and is poised to grow by only 1-3% in this financial year. In the first two months, though, sales have declined by 11% and only recent launches have succeeded, such as Honda Amaze and Renault Duster. The rest of the pack is looking to emulate their success.

"This car (BA) will give fresh impetus to our strategy in India," said Bo Shin Seo, MD and CEO, Hyundai Motor India. "We expect to sell around 200,000 units of this annually. It will be our bestselling car in India, and will be exported as well."

The same with Ford, which saw an over 16% decline in sales in 2012-13.

"The EcoSport will open a new chapter in our story," said Joginder Singh, president and MD, Ford India. "People talk about the Figo and how that car changed the face of Ford in India. The transformation this car brings will be even more dramatic."