Indian
luxury cars - All revved up? |
 The
Indian luxury car industry is all geared up. The
reason is the launch of Hyundai's Sonata and
Honda's Accord, which will create a whole
new era of D segment luxury cars. And the market
will be aggressively competitive despite the low
passenger car volumes - a modest 5,000 to 7,000
cars a year - with car giants like Honda, Ford
and General Motors promising to dish out
new and more powerful cars.
The Indian car market has definitely come a long
way in the past two decades. Fifteen to twenty years
ago, Ambassadors, Premier 118s andFiats held
court. However with the intervention of Sanjay Gandhi,
Maruti Suzuki came to India. In 1989 - 90
came the Esteem priced at Rs 4 to Rs 4.5
lakhs. Following it, were the Escort, Mitsubishi
Lancer and others. And the last two years have
seen a phenomenal growth in the A and B segments
with the entry of the Matiz, Indica and
Santro. Then came the sensational Qualis
launched by Toyota. Despite a disadvantage
in appearance, it is often sported as a status and
prestige symbol.
As of now there are four dominant segments. In the
A segment, there's Maruti 800, Fiats and others.
In the B segment, there's Santro, Matiz and Tata
Indica. Ford Escort, Mitsubishi Lancer, Ford Ikon,
Mercedes and others are the ones in the C segment.
 But
with bigger and highly disposable incomes, with
people who most often travel in Opel Astras
and Honda Citys willing to graduate to more
expensive cars, the D segment car manufacturers
have chosen the right time to make their presence
in the market. Two companies that have made an entry
of late in this segment are Hyundai with the Sonata
and Honda with the Accord. These giants believe
that their target audience will not mind shelling
out Rs 12-16 lakh for experiencing the best of the
automotive sensation.
The price war that has begun with these new entries
had its beginnings with the launch of the Mercedes
C class, priced at Rs 19,90,000 (ex-showroom,
Mumbai). Before this, all that was required was
to pick an exact price from the huge gap that existed
in the market between the most expensive car - Mercedes
Benz S320L at Rs 62 lakh (their least expensive
until recently was the E220CDI priced at Rs 30,46,509)
and the next expensive one was the Mitsubishi Lancer
variant priced at Rs 9,94,719. Comparing prices
from launch of the Esteem, a definite trend shows
that prices drastically increased by Rs 6-8 lakhs
with every new launch.
But the introduction of the Mercedes C class changed
the whole pricing gamut. Even the Honda Accord,
despite being in the D segment, is priced Rs 5 lakh
below the C class. However the group can bank on
its international popularity and brand status in
India, to give them a head start. It is also a more
powerful car with a 2.3 litre engine. All these
factors perhaps give it an upper hand over the Hyundai
Sonata.
 However
Hyundai is also a very strong brand in India thanks
to Santro. It launched the Sonata in mid-July with
a pricing of Rs 12-13.4 lakh. With over two lakh
cars in the Indian roads, Hyundai can today boast
of an unparalleled product support network, says
Hyundai Motors Director (Marketing) BVR Subbu.
He is confident that the Sonata would be a great
success in India.
Despite their recent launch, both the cars have
done exceptionally well. Accord, within a
few weeks of launching, had already sold 300 units.
And according to sources, Sonata has created
enough interest within 10 days of its launch for
Hyundai to deliver 55 units in July alone. This
spurt in sales clearly indicates the interest and
the excitement that has been created in the car
market. Now we shall await the much talked about
car - Ford Mondeo. Here's cheers to a revved
up industry! |
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| Source: The Economic
Times, Business Today and others |
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