April 1st 2010 would be written in gloden words in $35 billion Indian Automobile industry. In another step towards greener technology, we are going through a phase of evolution from Bharat Stage I to II to III and now much awaited IV norms.
But are all Indian Players ready for it? And how expensive would the new cars be with new norms, considering the current norms prevailing in the market? But we think that considering the economic meltdown and the ever looming recession, the work is still difficult for any automobile company, despite the fact that some players like Maruti Suzuki, Hindustan Motors and Hyundai claim boldly that they are ready for it and even come up with cars that comply to these norms.
Why it is that none of NE states have been named to comply with Bharat IV norms? Are they neglected? And would there be price reduction for those CV and passenger vehicles which does not comply with IV norms? And do you think that people who do not reside in those 11 identified cities (NCR, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Ahmedabad, Pune, Surat, Kanpur and Agra) are left unattended to suffer from pollution? And don’t you think it would create another marketing dilemma for these players to decide upon to focus more on which area after April 1st – 11 cities or Rest of India? And by how much %age is it expected to boost exports?
One would be surprised to know SIAM officials are happy to stay behind European norms and cited the example of after-treatment devices as they claim that we can learn from their experience. Are Indians born to be followers according to these officials?
Great news for workers and planners of NREGP! We think that the governement has to put up a separate notice board at each state board that one is moving from Bharat stage IV norms area to non-norms area, if one is going from say Delhi to J&K.
Share your ideas!
This seems to be interesting, so many questions in one shot!!
ReplyDeleteThere are players like Maruti Suzuki ( referred as MS henceforth) and hyndai which is doing well in this recession, thanks to the growing exports, large product line and increasing middle class, who can afford to change the design of their engines to match the Bharat 4 norms. But companies like HM which has ambassador will surely have problems. Even in MS, products like 800 & Alto will have a hitch since their price will be increased comparatively higher than the other products of the company as others require minimum upgradation. We also need to look at the aspect that MS has 800 in its lowest price segment as compared to Tata Nano which is 1.25 lakh car. Now, increase in the price of 800 is sure to have a negative impact on its sales.
It is wrong to interpret that NE states have been neglected. The pollution level in these states is pretty low and therefore they dont reqire these norms just like other parts of the country apart from the mentioned 11 places. But I believe that these states along with other states must be made compulsory to follow the Bharat 4 norms as the pollution is bound to increase in these places also since manu companies are now aiming at the tier 2 and tier 3 cities. So prevention is better than cure.
Diffferences in marketing strategies, well, I don't think so. I believe its not required. I guess there the same ads all across the country, the difference being only the price which anyhow is different in different states. Finding the percentage increase is difficult (or if you have any method / idea, then plz share) but obviously, there would be increase in the exports as the cars will comply with the equivalent Euro 4 norms thus making them compatible for that market.
Hey Anuj well thought out plan for future for Indian Automobile market. Could you think of some of the strategies which MS could deploy to counter the attack from Tata Nano, as MS calls M800 as its cash cow. Well, I strongly believe that once Bharat Stage IV norms comes into effect, marketing strategies would be different only between those cities which comply with it and those which do not comply taking into consuideration, the cars which comply and those which do not.
ReplyDeleteWell I dont really feel there will be significant different difference in marketing strategies after Bharat IV norms.
ReplyDeleteThe reason being that pollution norms of the engine are hardly publicised by the companies. Generally this feature is not prominently used as a factor of differentiation. I bet MOST of the consmers do not even knw which norms do their Car engines follow.
Its true tht price difference will b created in different cities. But as Rightly pointed out by Anuj, We always have differe
nt price across different states
Well, thanks first of all for the appriciation.
ReplyDeleteMy stand on marketing of cars in different states would remain the same, ie, there would be same marketing strategies in all the states as also said by the Anonymous post above.
Regarding Tata Nano vs M800, there's a strong uncertainty both in terms of Nana & 800.
Tata Nano - As the cheapest car opened its booking on 9th April 09, the company thought of having around 5lakh orders. But to their dismay, the orders were just about 2.10 lakhs and that too of Tata Nano LX, which is the costliest varient and therefore it was highly unexpected. Thus, it was assumed that for now that mostly the upper class segment has ordered the car and that is for the early adopters and visionaries status. The car is yet to make a mark on the people for which it was develoed - the common man.
Additionaly, there are few drawbacks also which can be read at http://infodbmag.blogspot.com/2008/01/tata-nano-pictures-photos-images-tata.html.
Thus, it is too early to say Nano as the car for future. Its success is yet to be confirmed. But there is no denying of the fact that Mr. Ratan Tata & his team has done a wonderful job.
M800 - Entered into the cash cow category, it is now probably going to decline stage. As said earlier, the cost of renovation of its engine would be quite high which would increase the cost of the car if it wants to have the Bharat 4 norms satisfied. So, can MS compete with the low cost Nano?
In my opinion, MS should now come with an innovation of Green car or something of that kind. MS says to utilize the Indo - Thai trade pact to bring components at lower costs to develop low cost car. But again the components of such cars are bound to increase as they use elements which are rare and are increasingly being used. Hence, there are both factors - innovation & cost. It cannot be said as of now which will dominate.
very well discussed so far. i wud like to state that maruti is goin to take off 800 from the market in 2011 since the cost of changing the engines r increasing the cost of the car in the entry level category.
ReplyDeleteAnother thing i wud like to state that since there are limitations to the no. of nano tata will produce in a year,the no. of application for the car is less.and also that people are sceptical about the performance as well as built of the car,people wud like to wait for the car to hit the road.