Auto X-tra: The All New Cars Show (pg 2)

[Contn.]
The All New Cars Show

Winners And Losers

ON A ROLL
With bikes taking the lead, the two- wheeler industry is pacing in top gear.

In contrast to the gloom in the car industry, it was high-five time in the two-wheeler industry in 2001. Well, almost. Sales in the Rs 9,000-crore industry grew 3.52 per cent in January-October, with motorcycles making up 70 per cent of the 41,31,061 vehicles sold.

Launches were aplenty. Hero Honda launched two 100cc bikes-Passion and Joy-and Bajaj Auto introduced the 175cc Eliminator, the 111cc Aspire and Caliber Chroma, the 100cc Boxerct and the 125cc Pulsar. TVS launched Victor and LML launched 110cc variants of Adreno and Energy. Kinetic launched its GF mobikes and Yamaha its Cruxr.

Hero Honda plans to launch a motorcycle in the 100cc segment and Bajaj a 175cc variant of Pulsar. Says Atul Sobti, Senior Vice President (Marketing and Sales), Hero Honda Motors: ''Next year will be better. While the scooter sales will level out, motorcycle sales will grow at more than 15 per cent.''

EXPECTED LAUNCHES, 2002
These are some of the cars you may be driving next year.

HYUNDAI SANTA FE
Hyundai is likely to launch a 2.5-litre diesel variant of this SUV in the second half of 2002. The company is likely to opt for the SKD route for this launch.
Price: Rs 18 lakh

TATA MAGNA
Tata Engineering had unveiled the Magna in Auto Expo 2000. The car is expected to be launched in 2002-end in 2-litre petrol and diesel variants.
Price: Rs 15 lakh

TOYOTA CAMRY
The Japanese car maker is likely to launch the all new 2164cc Toyota Camry in the second half of 2002. It will be positioned against Honda Accord and Hyundai Sonata.
Price: Rs 18 lakh

MITSUBISHI PAJERO
Hindustan Motors was to launch the 3200cc petrol Pajero in September 2001, but didn't get the CBU clearance. Now, the launch is scheduled for early 2002.
Price: Rs 32 lakh

OPEL ZAFIRA
General Motors is busy finalising its CBU import plans and this MPV is a strong contender. The company may bring a 2-litre diesel and 1.8 litre petrol variant of the Zafira in 2002.
Price: Rs 15 lakh

Market leader Maruti Udyog managed to marginally improve its marketshare to 60 per cent this year, as compared to 58 per cent during 2000-01, chiefly because of an expanded product portfolio backed by aggressive marketing. Despite the slowdown, the company's sales increased by 6 per cent during April to October 2001. Bagging the number one slot in the 'JD Power Asia Pacific 2001 India Customer Satisfaction Index Study' for the second consecutive year also helped the car maker. During the year, Maruti ventured into the second-hand car and leasing business.

Maruti's dealers ramped up their aggressive marketing strategies, slashing loan rates by half in December-usually a month that is marked by low car sales-for some models like the Alto, Zen, and the Wagon R. Some dealers proffered gold coins with cars and in Mumbai, one dealer tied up with automobile designer Dilip Chhabria to provide customised Maruti cars to buyers.

Not that the other car makers were lacking in aggression. Hyundai Motor India, Tata Engineering, and DaimlerChrysler also tried to buck the trend by launching new products or adding new features to existing models. Hyundai launched a finance company, introduced a car exchange programme and its dealers now handle all insurance-related work for customers, eliminating intermediaries.

At Tata Engineering, the launch of a new, improved model of the Indica, the v2, helped it stage a comeback by topping the B segment sales sweepstakes in September and October. With the v2, the company claims it has plugged Indica's earlier technological and quality snags. Says Dube: ''During April to November this year, Indica's sales have risen by 28 per cent.''

The biggest loser in the car industry in 2001 turned out to be Daewoo Motors India Ltd. The Indian subsidiary has been left out of the gm takeover of Daewoo Motor Korea and will be referred to the Board for Industrial and Financial Reconstruction (BIFR) if it is not able to raise funds by December end. In June, the company stopped providing its sales figures to SIAM (The Society of Indian Automobile Manufacturers) and many of its dealers have migrated to Tata Engineering and Fiat. Companies like Ford India, Hindustan Motors, Honda Siel Cars and General Motors also recorded lower sales during April to October 2001, compared to the same period last year.

Enter 2002

Yet the histrionics in the car market aren't showing signs of ebbing. Already a number of car makers have lined up high-profile launches for the coming year, recession be damned.

Several new cars, like gm's Opel Vectra and Zafira, Hyundai's Santa Fe and Elantra, Toyota's Camry and Landcruiser Prado, Ford's Escape and Mitsubishi's Pajero are expected to be launched next year, primarily through the CBU route.

The overcrowding in some of the segments doesn't deter companies. Tata Engineering is expected to launch Tata Magna in mid-2002, positioned in the D segment, and a station wagon variant of Tata Indica next year. Maruti Udyog too plans to launch another model, but is unwilling to disclose details. And Fiat India is planning a facelift for its Siena and Siena Weekend. With the market listless, does it make sense to launch more models? Yes, say car makers. Rationalises Jagdish Khattar, Managing Director, Maruti Udyog: ''New launches create excitement in the market, and become more important during a downturn.''

Indeed, most car makers expect 2002 to be better than 2001, though R. Seshasayee, President, SIAM, and Managing Director of Ashok Leyland, expects the passenger car segment to continue to perform poorly ''Cars, light commercial vehicles, and mopeds will remain laggards in 2002. What has really marred the car segment is the absence of the feel-good factor,'' says he.

But optimism stems from hopes of an economic recovery. ''We can already see the signs of a revival,'' says Hyundai's Subbu. ''Cement prices have firmed up, commercial vehicles are doing better and due to good rains, gross capital formation has begun to take place in rural areas.''. All these factors can help the car industry in 2002. Echoes gm's Chaba: ''I expect car sales to pick up by 2 to 5 per cent.'' Adds David Friedman, Managing Director, Ford India: ''The initial months (of 2002) may continue to be tough. But around the middle of next year, I expect the economy to be upbeat.''

Still, in an industry that has more than a dozen players and where capacity exceeds demand by over 30 per cent, a mere 5 per cent increase in sales will do little to improve the financial health of manufacturers. At last count, just two of them-Hyundai and DaimlerChrysler-were in the black.

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