New Delhi: Honda Motor could introduce the diesel variant of its high-selling compact car ‘Brio’ in India this year, bringing forward plans to tap a car market skewed away from costly petrol.

The carmaker is testing its newly developed diesel technology, common rail i-DTEC, on the Brio and could introduce it in a 1.2-litre version. The diesel variants of its City sedan and Jazz hatchback, carrying larger engines, will be introduced later. The company had earlier planned to introduce diesel vehicles in 2013.

“Honda is committed to bringing its diesel technology to key markets like India. And to ensure that Honda diesel is best suited to local conditions and offers optimum performance levels, Honda is conducting stringent tests at its R&D centres across several locations,” a company spokesperson said in an email response. Honda, which operates in India through its JV Honda Siel Cars India, is keen on regaining market share from rivals Volkswagen and Toyota whose diesel cars account for a large chunk of their sales.

The Japanese automaker, which entered India in 1995, has seen sales fall 27% in the first nine months of the current fiscal, largely because it was unable to introduce any diesel variants, which have become popular in India because of the rising cost of petrol.

The carmaker’s output in India was also affected by shortage of components after last year’s tsunami in Japan and flash floods in Thailand, which led to a 36% loss in production, or 27,939 units, in the April-December period.

The i-DTEC engine, nicknamed “Earth Dreams Technology” will first be used in the new Civic sedan in Europe this year. According to some people working closely with the company, “its application for other models and markets is likely to come in the shape of Brio compact car for India in the initial phase”.

Diesel cars, which registered a 26% rise in sales in the first nine months of the current fiscal, accounted for about 60% of the passenger vehicles sold in the country. During the same period, sale of petrol cars dipped 18%. According to industry executives, diesel cars account for over 80% of sales in models like Maruti Swift and Hyundai Verna, where both fuel options are available.

With the advent of the all new Maruti Suzuki Swift, it was only a matter of time before the new Dzire made its debut. Vikram Gour spent a day out on the Buddh International Circuit with the new car. Read on to find if it hits the right spots!

A car is an object of affection. While function, practicality and logic do play their part, the drool factor has always played a major role in the decision making process of purchase for potential car buyers are looking for a vehicle that will make them look good, stand out and simply gel with their persona.

Having said that, there are a handful of cars that have been a market success based on their merit of being extremely practical purchases. Their looks are not something to write home about, but the vehicle itself has proved its mettle and gone on to become a success story. Such is the nature of the Swift Dzire.

When it made its debut around four years ago, one couldn’t phantom how MSIL would fit a boot onto a car that was designed to be round. That being said, I am yet to come across someone who doesn’t like the car! In terms of numbers the Swift Dzire clocked over 10,000 units a month and MSIL has sold over 3.3 lakh units till date in the domestic market.

With the advent of the new Swift, it was a wait and watch game to see how MSIL would treat the boot on the new Dzire this time around. Fingers were crossed that the designers would pay more attention to detail and design, however they seemed to have walked down a new path and enter the realm that has so far only seen the Tata Indigo CS occupy. That’s right, instead of working on a gorgeous rear, the new Dzire has been designed to fit the 4000mm length requirement that the Indian Government has stipulated as the definition in size for small cars and therefore benefit from the additional excise cut.

Fitting a boot onto a hatchback that measures 3850mm in length while keeping the overall length of the car under the 4000mm mark obviously isn’t any easy feat to accomplish and the designers literally had even less room to play around with. The result of all this tinkering and scalpel treatment is a notch. No, the new car isn’t a notchback, but a proper three box sedan, albeit with a very tiny looking boot.

The size is most apparent when the car is viewed from the side and there is no doubt that this is going to take some effort for those looking for a three box car to digest. The design is boxy compared to the rest of the car and the boot sticks out distinctively from the otherwise round sporty lines of the Swift. The factor that does light up the rear are the large tail lamps which now form a trapezoidal appearance and frankly look quite nice, but that is just a consolation prize to an otherwise mediocre design.

Measuring 3995mm in length, the new Dzire still manages to offer more than its hatchback sibling in terms of space. Despite the truncated boot, it offers 316 litres of trunk space, which is over 100 litres less than the outgoing model. While this does take away slightly on the whole practicality aspect, the new Dzire is still a decent purchase for those looking for a no nonsense entry level sedan.

The Dzire is based on the new Swift so it gains from the fact that interior space has been optimized for passenger comfort.

Moreover Maruti Suzuki has packed the Dzire to the hilt with goodies which includes a dual tone dash, integrated stereo on higher models, climate control air conditioning as well as a host of safety features such as front dual SRS airbags, ELR seatbelts, ABS, Brake Assist, EBD and an Engine Drag Control system.

The Swift Dzire will be available in both petrol and diesel engine options. The petrol variant boasts of the K12M VVT petrol engine which delivers 87PS of power @ 6000rpm and a decent 114Nm of torque @ 4000 rpm. Tuned to offer a spirited drive yet retain a decent mileage figure, the petrol

Dzire is capable of going from 0-100kmh in just 12.6 seconds and offer a company claimed fuel efficiency of 19.1 kmpl.

The diesel variant retains the tried and tested 1.3litre DDiS engine that generates 75PS of power @ 4000rpm and a solid 190Nm of torque @ 2000rpm.

Being a class leading engine in terms of fuel efficiency, the diesel Dzire offers a company claimed efficiency figure of 23.4kmpl and still manages to go from 0-100kmh in just 14.8 seconds.

Now all these figures might seem rather high for an entry level sedan, especially when compared to its hatchback sibling, but here is the key to all this wizardry. The Dzire weighs in exactly the same as the hatchback, despite the slight extension in size!

Now MSIL hasn’t just stopped here, but have taken the Dzire a notch further (pun intended) by also offering an automatic transmission variant.

The four speed automatic transmission will debut with the petrol engine initially however we are praying that this extends to the diesel in the future. The box is a smooth unit that is extremely well suited for city driving and will be a boon any city dweller.

It is worth mentioning however, that the automatic variant doesn’t come with climate control air conditioning and features the regular switch and blower unit that we are accustomed to on smaller cars.

So, after having spent a day out with the Dzire, I have returned with a mixed bag of emotions. On one hand, the car just doesn’t offer any visual delight, but there is brilliance in what MSIL has achieved. By making it less than 4000mm in length, it benefits from the excise cut and therefore lets the company pass on that benefit to the customer in the form of lower pricing.

At the same time, MSIL has packed the car with ample goodies and safety features that are comparable to sedans from a segment higher. Where this leaves the equation is just about exactly where the original Dzire started its journey-practicality.

The new Dzire is once again going to have to make its way into the market by trumpeting the practical vehicle badge. It might have lost out on a little trunk space but there is still no arguing the fact that it still remains a very practical offering that is hard to ignore and customers should be urged to look past the sheet metal and recognize the genius that lies underneath.

Mumbai: Jaguar Land Rover will invest aggressively in new products and technology over the next 3-5 years even as the slowdown in Europe continues to be a matter of concern. Tata Motors bought out these two British from Ford Motor Company for $2.3 billion in 2008. Today, they are among the largest revenue generators to the Indian automaker.

Dr Ralf Speth, Chief Executive Officer of JLR, told Business Line that it was not the easiest of decisions to invest in a downturn as any company would have to leverage wisely between growth and liquidity.

“During a crisis, cash is king since getting money from banks during these times is nearly impossible. This makes it even more challenging to balance things out in the right way,” he said.

Some companies opt for the safe route of cash conservation in difficult times while others try and find a way in between marginal investments while steering clear of product creation.

“The third route involves saving wisely while not interfering with the (product) development process. When the crisis is over, the company concerned emerges a lot stronger with new products. I personally am in favour of this option though it finally depends on how long the slowdown lasts if we have to maintain the R&D momentum,” Dr Speth said.
Be Flexible

From his point of view, it is imperative for JLR to be flexible and save in every way possible while giving top priority to product development. “This is what the market will demand when the slowdown is over. We should be financially cautious but still push forward with new products. The world has seen a lot of crises and we need to be constantly optimistic,” Dr Speth said.

This, however, does not take away the fact that the recent events in Europe are a huge cause for concern to carmakers especially when nobody has a clue on what lies ahead.

“I am very worried about 2012 and what is even more disconcerting is the unpredictable scenario. Just when we thought the worst was over post-Lehman, we are now up against this crisis,” he said.
US, emerging markets

The silver lining in the cloud is that the US is beginning to show some signs of recovery though Japan could still stay relatively flat in 2012. Eventually, JLR is pinning its hopes on emerging markets like India, China, South America and Russia with products like the Range Rover Evoque, Sport, Discovery and XJ.

China, in particular, has been the best piece of news in 2011 with sales of over 42,000 units which accounts for nearly 16 per cent of the company’s global volumes of 2.45 lakh vehicles. In contrast, sales from its traditionally reliable markets like the UK, North America and Europe fell to sub-20 per cent levels. This could just get worse if the slowdown continues through 2012.
Upbeat on India

Dr Speth was as upbeat about JLR’s prospects in India, a market where its owner, Tata Motors, is one of the oldest auto brands. “We think India has the potential to grow like China in the coming years. The team has done a great job in developing the overall base and I am very satisfied,” he said.

There are concerns that the India story could be derailed during 2012-13 thanks to the Europe crisis. However, global carmakers do not share this pessimistic outlook especially when the rest of the world is in a semi-paralytic state.

“If India has a problem with 7.9 per cent GDP growth, I think seven per cent would be fantastic in Europe though it may not be achieved in the next ten years. Obviously, there is a different perception of what a crisis means as emerging markets will eventually offset negative growth in one or more industrial nations,” Dr Speth said.

New Delhi: Green is in vogue at the current Auto Expo with automakers, including Maruti Suzuki, Hyundai Motor, Nissan, Mahindra and Mahindra and Hero MotoCorp lining up electric and hybrid vehicles for future launch. However, automakers feel that the road ahead for such cars is bumpy with no policy incentives and infrastructure support.

At present, Mahindra & Mahindra’s all- electric Reva is the first and only electric car on the Indian roads. As the two- seater vehicle attracted only few curious and green- conscious buyers, the company has unveiled a new four- seated version slated for commercial launch before Diwali 2012.

According to sources, the company is working on keeping the price in the range of ` 4- 5 lakh, as it is looking at larger commercial success.

“ We have been saying time and again that electric and hybrid cars are the future. But price is one factor that needs to be worked on. With more infrastructure support and incentives we are sure that more companies will come up with such technologies,” Pawan Goenka, president ( automotive and farm equipment sectors), Mahindra and Mahindra, said.

Another firm Toyota Kirloskar Motors launched the new Prius at the Auto Expo priced at ` 27,38,500 to ` 29,40,500 ( exshowroom Delhi).

“ Hybrid is the technology for tomorrow. We aim to raise awareness of hybrids.

With a solar powered ventilation system we hope to see more Prius customers,” said Shekar Viswanathan, deputy managing directorcommercial, TKM. Even companies like Maruti Suzuki that has stuck to the traditional fossil fuel- driven engines are looking at commercially manufacturing a hybrid Swift. According to reports, the carmaker has already started road- testing the Swift ‘ range extender’, which runs on an electric motor, and alternatively on petrol.

Two- wheeler companies are not far behind.

Hero MotoCorp, the leading two- wheeler maker in the Indian auto market, uncovered its first ever concept hybrid scooter, Lead, at the Auto Expo.

2011 was a tough year for Maruti Suzuki India (MSIL). The car market leader has been losing market share as competition gets more intense and overall growth shrinks. But the company is confident of wresting back lost market share this year, chairman R C Bhargava told Sindhu Bhattacharya in an interview.

Excerpts:

What is the outlook for Maruti in 2012? Are you stepping up focus on rural and semi-urban pockets?

The prospects for the car market in India during 2012-13 will become clearer after the Budget. Factors like recovery in Europe, reversal of the decline in the rupee, the inflationary trend, interest rates and fuel prices will all play a part. The policy regarding pricing of diesel compared with petrol will also be relevant. However, Maruti Suzuki does expect that it will have a better market share in 2012-13 as compared to the current year, when the strike in the factory caused a decline in sales and market share. The rural and semi-urban markets have been areas of priority for us and will continue to remain as such.

Do you think it is the right time to enter a new segment? How has your luxury car offering Kizashi performed since launch? Is Maruti stretching itself too thin in an attempt to cater to all segments?

We are proposing to enter the MUV (multi utility vehicle) sector with the Ertiga. The MUV segment is a growing market and we believe it is the right time to launch a model. The Kizashi was never expected to sell in high volumes and has been impacted by the falling market as well as a weak rupee. However, having vehicles in all segments is the right strategy for MSIL, being the market leader in India.

Maruti saw a massive disruption in production in 2011 amid worker unrest. In hindsight, do you think the management could have handled the labour issues better? Could the state government or outside unions have offered you more support in dealing with truant workers?

I believe the labour issues were handled very well by the MSIL management. The state government gave full support in dealing with the problem. Outside trade unions really had no role to play in bringing about a solution. The management has implemented a number of measures which are designed to bring about closer and more productive relations with workers and prevent further trouble.

Maruti has been struggling to meet demand for diesel cars. Is there is any plan to put up fresh diesel engine and vehicle capacity to meet this growing demand? Has the sourcing deal with Fiat for diesel engines been finalised?

Please check the position of the deal with Fiat with the management. An investment decision for producing more diesel engines by establishing a new line would be considered after the Budget.

Your take on competition in passenger cars… Have you decided to delay or postpone investment in the new facility in Gujarat because of the current slowdown?

The market will continue to be highly competitive. MSIL has been successfully dealing with this and will continue to do so in the future. We are not slowing down investments in Gurgaon. The work on Line 3 was started some time ago and is continuing. (He made no comment on investment in Gujarat.)

New Delhi: Though the cut-throat competition in the voluminous passenger car market is well documented, a quiet war is now breaking out in the niche luxury car category, which industry experts feel is becoming the new battleground and would script the next phase in the Indian auto story.

After selling 6,281 units in 2010-11 to topple Mercedes-Benz (5,987 units in 2010-11) as the No. 1 luxury car maker in India last fiscal, BMW is now gearing up to introduce its small car Mini for Indian roads in 2012. Even before the ramifications of the move could be felt, Audi has announced that it aims to become the number one luxury car maker in India by 2015. According to Audi India head Michael Perschke, the company would achieve the target by introducing products with cutting-edge technologies.

At the Auto Expo next month, Audi would be showcasing two new products to catch consumer eyeballs — Audi A3 (a budget sports sedan which could be the cheapest offering from the company till date) and the S6 (a stylised luxury limousine).

Meanwhile, sources said that Audi’s German rival Mercedes is also firming up plans to introduce a small sport utility vehicle B-class next year to take on BMW’s high-selling X1. However, it could not be officially ascertained since an email sent to the company remained unanswered.

So what is making India tick with luxury brands?

“Higher disposable incomes and a relatively younger population of affluent people is making India a very attractive destination for luxury brands. Look at the number of luxury foreign watchmakers that are looking to enter India,” Perschke said, and added that “strategically” India is among the top 10 markets for Audi.

In the April to September period so far this year, while the overall car market grew at a tardy 1.8%, BMW has grown at 87% to 5,005 units, Mercedes-Benz at 19.5% to 3,501 units and Audi at 85.3% to 2,864 units.

Perschke said that by the end of the calendar year Audi would have sold over 5,000 units.

“Audi’s global plans is to become the number one luxury car maker in the world by 2015. In India, we also aim to do the same. And our India strategy would be the same as the one followed globally,” Perschke told The Financial Express.

In fact, globally Audi expects to pip its former owners Mercedes Benz in 2011 (Audi was sold to Volkswagen by Mercedes in the 1960s) and sell close to 1.3 million cars in the calendar year. While India currently accounts a small percentage of Audi’s global sales, Perschke said that in the years ahead the country would emerge as the new China — where for the first time more Audis would be sold than in home country Germany.

Leader automotive practice at PricewaterhouseCoopers Abdul Majeed said that the competition in the luxury space is only going to intensify from here on. “The segment has been growing at an exponential rate. Today the numbers might not be great, but they are bound to increase,” he said. According to Majeed, the strategy of Mercedes-Benz, BMW and Audi to introduce lower price point products is redefining the segment.

New Delhi: The depreciating rupee is set to make cars dearer as increased manufacturing costs due to expensive imported parts is forcing companies to look at a price hike, despite the industry being affected by one of its worst slowdowns.

Top auto companies like Hyundai, General Motors, Toyota and Mahindra have all said prices will go up from the New Year as costlier parts have increased manufacturing cost. Market leader Maruti has already raised prices of its diesel variants and is also complaining of the increased pressure from the rupee slide. “We are very badly impacted and will be passing on the increased cost from January. The price increment should be in the range of 1-2%,” said P Balendran, V-P at GM India. Fresh counter measures like hedging will be worked upon at the end of the month, Balendran added.

Maruti said the pressure is immense. “The rupee fall has been very sharp and taken everyone by surprise. No one would have predicted that the slide will be like this,” CFO Ajay Seth told TOI. He said the rupee had depreciated as much as 30% against the dollar since April this year. While the company has a high degree of indigenisation, it also has substantial imports which are not only done directly but also by its vendors. “The total import content is about 21% of net sales, directly as well as indirectly. There has to be some intervention by the RBI now,” Seth said.

Arvind Saxena, sales and marketing director at Hyundai India, also said prices will increase by 1.5-2% due to many negative factors, including the rupee fall. “The pressure of rising inflation, higher fuel costs and sharp rupee depreciation has compelled us to look at a price increase on our models. All these factors have now made it very difficult for us to absorb the rising costs.”

Toyota has also said that it will hike prices. “The rupee depreciation is adding to the cost and we will be going in for a revision from January,” Toyota Kirloskar Deputy MD (sales & marketing) Sandeep Singh said. Toyota had last raised prices by 1-1.5% in October. “The hike could be of a similar range or even more,” Singh added. Toyota’s vehicles like Innova and Fortuner have 50% imported parts and the rupee has made their costs higher.

Michael Perschke, head of Audi India, said, “With the continuous devaluation of the rupee vs the Euro and the dollar, we cannot rule out the necessity of realigning our pricing.” “Copyright © 2011, Bennett, Coleman & Co. Ltd. All Rights Reserved”

On the radar is a multi-purpose vehicle (MPV), a sports utility vehicle (SUV) and three small cars, which will be unveiled at the Delhi auto expo in January.

“We want to be present in all the categories where a customer may want to purchase a passenger vehicle,” Shashank Srivastav, chief general manager (marketing), Maruti Suzuki India, told The Telegraph.

Analysts said Maruti needed an aggressive product expansion strategy to arrest its falling market share.

Over the last one year, the car maker’s market share fell to 38 per cent till October from 45 per cent in the same month last year because of labour strikes at its factories and launches by its rivals.

The company has started expanding its portfolio with the launch of the Kizashi, a premium sedan, earlier this year. It also imports the Grand Vitara, a premium SUV from its parent Suzuki Motor, on demand.

The compact MPV Ertiga has been developed in collaboration with Suzuki and is expected to be the next growth driver.

The Ertiga will be available in both diesel and petrol versions with a seating capacity of around seven.

“Demand for compact MPV is steadily rising in India. It accounts for around 12 per cent of the market and is expected to grow very fast,” Srivastav said.

The Ertiga will compete with the Toyota Innova and the Chevrolet Tavera. Srivastav said the price would be “competitive”.

According to analysts, the car could be priced around Rs 6-9 lakh.

A concept version of a compact SUV will also be unveiled in January. Apart from the Gypsy, which is mostly used by the armed forces, Maruti does not have a presence in this category.

Around 7-8 per cent of the 2.5-million passenger vehicles sold in India are SUVs, according to the Society of Indian Automobile Manufacturers. Mahindra and Mahindra and Tata Motors dominate the segment, which is expected to double its market share over the next decade.

Maruti will showcase three small cars in the expo to “gauge viewer response”. Called the Solio, Palette and the MR Wagon, these cars are powered by 660cc engines and are already available in Japan.

“We are displaying these special category of compact cars to get customer feedback,” Srivastav said, adding that no plans were afoot to bring them into India.

However, analysts feel at least one of the three small cars is likely to be on the Indian road in the next 2-3 years.

Chennai: Skoda Auto India is bullish on its growth prospects, notwithstanding the rising interest rates and lack of enthusiasm from customers.

The company, which sold about 20,000 units in 2010, is looking at a 50% growth in the current year , said Thomas Kuehl, member of the board, sales and marketing, Skoda Auto India. The optimism stems from the C-segment Rapid, which has received an overwhelming response and crossed the 1,500 booking mark within days of launch.

“The company, for the first time in India, has introduced online booking for Rapid and sold more than 25 cars through this channel,” said Kuehl, adding: “We seek to introduce the online booking system for all our models in the near future.” Responding to a volley of questions, he said: “We have plans to introduce Fabia and Yeti variants, apart from a few models on the existing line. We expect Rapid to garner 50% of our total sales next year, with diesel variant expected to hold 70% of total Rapid sales.”

Kuehl said the company was bullish on Rapid as it was set to take on the premium C-segment competitors like Honda City, Sx4, Verna in a big way. “We do also see customers of other C-segment cars like Sunny, Fiesta, Dzire, Etios making inquiries on Rapid. India is a great market for us and Rapid, as an entry-level car for Skoda, with a made-in-India and made-for-India slogan, is set to ride high.” Kuehl said the company planned to sell 2,000 Rapids a month and hoped to sell 3,000 units by December.

He said: “While customers are showing interest in owning a car, the current interest rates, inflation and market sentiment have forced them to postpone their buying decisions. We hope things will normalise in the near future as India is a matured market.”

Gurgaon: German luxury carmaker BMW, which has grown 70 per cent and sold over 8,042 cars in the country till October, expects India operations to become its most successful operations in the world this year surpassing even China.

“Luxury segment was growing well till October but after that it is getting much more difficult as the market has changed. We had set a target of selling 10,000 units this year, which is becoming difficult now,” said BMW India President Andreas Schaaf.

“BMW India has grown 70 per cent this year and sold 8,042 cars till October compared to 4741 cars last year and we expect Indian operations to become our most successful operations in the world this year,” added Schaff.

Despite Indian operations becoming most successful this year for BMW, the No1 luxury carmaker in the country is leaving no stone unturned to further consolidate its position in the luxury car market. The company on Thursday launched its pre-owned car business BMW Premium Selection in a bid to enhance its position in the country and will also be launching leasing car scheme this year only.

“The pre-owned car business will play an important role in the success of the company in India and we expect the used car business to be about 10 percent of new car sales. As regards leasing of our products, we are working on the same and will launch this year only,” he said.