Figo Drives New Sales Records For Ford

The all-new Ford Figo has received more than 10,000 orders less than one month after it went on sale, a new Ford India record. In response to the strong demand, Ford India will launch a second production shift at its plant in Chennai.

The Figo’s popularity helped Ford India’s overall March sales more than triple from the same month a year ago, rising an impressive 203 percent to 9,478 units. The exceptional March performance, which also included strong sales of Ford Ikon, Ford Fiesta, and Ford Endeavour, were nearly triple Ford India’s February sales, increasing 194 percent.

“We are delighted at the initial response to Figo, and are incredibly proud to have struck such a positive chord with Indian consumers,” said Michael Boneham, president and managing director of Ford India. “The launch of Figo is the start of a transformed Ford in India, and a true reflection of our commitment to delivering world-class products that allow Indian customers to feel the difference.”

Part of Ford’s US$500-million investment in India, Figo was designed and engineered with Indian customers in mind – including months of exhaustive customer clinic research and thorough testing in both simulated and actual road evaluations.

Aimed squarely at more than 70 percent of the country’s new vehicle market, Figo has significantly bolstered Ford’s competitive position. This has been one of the best launch response and volumes achieved in the first month of sale by manufacturers in India’s automotive history.

The Figo is one of the more than 20 new vehicles Ford is introducing globally in 2010. The new cars, trucks and SUVs, which offer class-leading fuel economy, quality, safety and technology, represent substantially more new or freshened product by volume than was introduced in 2009.

During the course of this journey, more than 900,000 people visited the Ford Figo homepage www.fordfigo.in to know more about the car and spent and average of over 8 minutes on the website. In addition, thousands of people joined Ford Figo communities across social networking sites like Facebook, Twitter.

“As we remain committed to redefining the Ford brand in India, we expect this momentum to continue,” said Boneham. “Factors such as the initial price of the car, fuel efficiency and cost of maintenance are critical in determining affordability for a new car buyer. Indian customers are confirming that Figo solidly delivers on all of these.”

With longer intervals of key maintenance components due to better durability, competitive cost of the parts and the short time required for vehicle servicing, Figo is placed among the leaders in scheduled service over a 5 year/100,000 kilometre period.

As part of ongoing efforts to demonstrate its competitive cost of ownership, Ford India recently announced the opening of 28 dealerships in India, bringing the total number of Ford outlets to 164 facilities in 97 cities. The company plans to expand to 200 facilities by the end of the year.

Ford India to phase out Fusion superhatch

On the sidelines of announcing its dealership rollout pan-India, Ford India Private Limited (FIPL) has stated that it has firmed up its plans to phase out its not-so-successful car, Fusion in the medium term, without revealing any timeframe. The Fusion was launched in the Indian market in 2004 and is available in three variants and the company had promoted it as a combination of a hatchback and sports utility vehicle.



"We will discontinue the Fusion and our focus in the small car segment will be exclusively on Figo in the Indian market. The Fusion was also giving us a relatively small volume and we hope to do well with the Figo," Ford India managing director and President Michael Boneham told reporters in New Delhi. He also maintained that the phasing out is part of a product rationalisation strategy with the firm looking to focus on the compact car segment, which comprises over 70 per cent of the Indian car market that is heading towards the two million mark per year. He said the Figo would be positioned in the small-car segment, competing with cars from the Maruti Suzuki, Hyundai Motor India and Tata Motors stables. He told reporters, “After all, this segment constitutes the bulk of the market and even a 10 per cent annual growth would mean a huge addition to demand.” He did not believe that the premium hatchback segment was the place to be in, given its smaller numbers.

Meanwhile, as Ford India gears up to launch the small hatchback Figo, it has said that it will launch a new car every 12-18 months for the next few years. The Indian arm of the Detroit auto biggie affirmed that that it is better to be a volume player in the country, for which being aggressive in the small-car segment is the way forward. Ahead of its ambitious entry into the compact car segment, the company’s Indian subsidiary Ford India, on Tuesday opened 28 dealerships across 24 cities in the country, with small cities (Tier-II, III) as the main target market growth.

“What we are planning to do here is launch a new car every 12 to 18 months,” Michael Boneham, told reporters recently. Nearly 70 per cent of all cars sold in the country fall in the small car segment. “For us the majority of new launches will be in that segment across the next four to five years,” he said.

Volvo delinks from Ford India

Volvo in India will no longer be a subsidiary of Ford India, but a separate company.

With Ford Motor Company planning to sell Volvo Cars and announcing Chinese carmaker Geely as the preferred bidder, the Indian operations of the Swedish company have severed its ties with Ford India, said Mr Paul de Voijs, Managing Director, Volvo Auto India, while speaking to Business Line.

Volvo Cars India has changed its name to Volvo Auto India Pvt Ltd, with effect from October 1.

“The process which started in May should help in case of a possible sale. It will help avoid complications,” he said.

In 1999, Ford had acquired Volvo Cars from Volvo AB as part of its Premier Automotive Group, which then included Aston Martin, Jaguar and Land Rover. Volvo had begun operations in India in March last year as a subsidiary of Ford India, with all backend operations being handled by Ford.

When asked how the sale of Volvo may affect the company’s plans, especially in terms of component supplies for Volvo products, Mr de Voijs said that there should not be any impact.

“Short-term changes won’t affect our long-term plans for India. We do not believe in setting up a huge network at first, but instead, we believe in the gradual process to build our strength in terms of volumes as India is a huge market,” he said.

He added that the company already has seven dealerships in the country, which it will increase to 12 by end 2010. The new dealerships would be in Kolkata, Bangalore, Ahmedabad, Goa and Coimbatore.

Mr de Voijs said that Volvo had sold about 100 units between March and December last year and sales for the current year is close to doubling. “The luxury segment has grown by 20%, whereas we have grown by 23%,” he said.

Volvo has plans to launch two new cars in India next year. First up will be the smaller brother of the XC90 luxury sports utility vehicle (SUV), the compact crossover SUV XC60, which is slated for launch in the first half of 2010. This will be followed by the launch of the new S60 sedan in the second half of the next year. Volvo sells its top end S80 sedan and XC90 in India.

“The XC60 will be launched after the Auto Expo. We are currently road testing it at the International Centre for Automotive Technology (iCAT),” said Mr de Voijs.

He said that Volvo will also launch a diesel variant of the S80 next month, while the C70-coupe may also be made available, but on an individual basis according to demand.

Ford to increase market share by new car launches

Michael Boneham, president and MD of Ford India here on Thursday indicated that the US car maker, Ford has decided to launch a new car every 12 to 18 months in India to enhance its market share. However, he did not indicate what sort of market share the company aims to achieve in the long run. Talking to newsmen at the inauguration of Ford’s new dealership, Victoria Ford, Mr. Boneham said: "We now have a marketshare of nearly 2% and we want to grow it significantly in coming years. Launching of new cars from the Ford stable, will play a crucial role in growing our market share in India."

For 2009, Ford India aims to achieve sales of 30,000 cars compared to 29,000 cars sold in calendar 2008. "In September ‘09, we have been able to sell 3,500 cars which is a 50% increase year-on-year basis," said Nigel Wark, executive director (marketing, sales and services). By investing $500 million, company will expand production at its Chennai plant from 1 lakh to 2 lakh vehicles, apart from producing 2.5 lakh engines, both in petrol and diesel.

SUV Ford Endeavour with some added facilities is being relaunched by Ford and Boneham informed that the new Ford Figo, on which the company is depending to get into the lucrative A segment, would be available in both petrol and diesel variants also. The company exports its cars produced in India to South Africa. Ford’s foray into the Indian compact car market with Ford Figo is expected by the first quarter of calender 2010 and the vehicle would be exported to Asia Pacific and Africa along with sales in India. Last year, the company had exported nearly 4,000 cars.

Ford Figo Unveiled

The much-awaited small car from the US auto major Ford has been unveiled in New Delhi. The car has been christened Figo.

Ford Figo is a four-door hatchback that will be available in both diesel as well as petrol engines.



Figo has the main elements of Ford’s kinetic design language such as modern headlamps, grille shapes and sculpted bonnet of its distinctive face to the subtle integrated spoiler and chamfered window shape at the rear, which the company has used in world renowned vehicles such as Ford Mondeo, Ford Focus, and the Ford Fiesta. It also has very contemporary features, with a completely new look that is very different from the usual Ford models.

Figo is a synonym of car that has essence, superiority and intelligent designing, which is truly Italian inspired very similar to the name of the car which in Italian means cool. It also has a solid posture and a very spacious and elegant. The Figo is designed to suit the best the urban driving conditions.



The Figo also has a molded body side with chiseled front fenders, a “comet tail” undercut in the doors and additional light-catching sculpting in the lower body side.

The Figo has a bold graphic with large side window shape and spaciousness awaiting occupants’ front and rear and the side window graphic has a blacked-out B-pillar.

The engine specification or transmission details are not available.

The production of the car will begin in the early months of 2010. The company has also not yet unveiled any details about the pricing of the car, but it is expected to be priced at something higher than Rs. 3 lakh.

Ford India to launch small car in India

Ford India Friday said it will launch a small car in 2011 in order to tap the growing market for compact cars in the country.

"The launch will be a game changer. It will take us into the centre of Indian market," said Ford Motor executive vice president for Asia Pacific John Parker.

The car will be priced between Rs.3-4 lakh. "It will be in the range that 70 percent Indian consumers buy," Parker told reporters on the sideline of the annual convention of the Society of Indian Automobile Manufacturers (SIAM).

Ford has invested about $500 million in India since 2008.

The company will also launch a refurbished version of its sports utility vehicle - Endeavour - next month.

"We will launch a significantly improved Ford Endeavour in a week's time. Consumers were looking for higher technology in the product and they will get the same," said Ford india president and managing director Micahel Boneham.

Ford Launches Ikon iKool

Ford India, as earlier announced, has launched a new variant, the Ikon ikool. This new variant from Ford India has an iPOD compatible MP3 Player.

This addition in the model is surely targeting at the music lovers. The car has another added attraction; it has anti theft system with remote entry ensuring that the car is safe.

“The Ikon iKool is a fun to drive yet economical car. Its new feature rich persona along with legendary driving characteristics will appeal to the upwardly mobile and ambitious customers who want their car to complement their active lifestyles.

The Ikon has proved its mettle and raised the bar in terms of dependability and fuel efficiency during the marathon ‘Ikon Cross Country Drive’ registering an extremely low cost of ownership which makes the iKool a phenomenal value vehicle that is feature rich, dependable and affordable,” said Nigel Wark, executive director for marketing, sales and service at Ford India.

The spacious interiors of the car now have the new seat covers, which gives a sportier look for the car. The exteriors of the sedan have new iKool badging, chrome deck lid applique, a spoiler, and chrome deck lid.

The Ford Ikon ikool will be available in both petrol and diesel variants, the diesel version will be powered by an advanced Duratorq TDCi 1.4 engine and the petrol by a ROCAM 1.3 engine which offering wonderful mileage of 28 kmpl on the highways and extra smooth driving experience.

Starting 12th August the Ford Ikon iKool will be available at all Ford dealerships across India at a price point of Rs. 4.82 lakh for petrol and Rs. 5.42 lakh for diesel version (ex-showroom New Delhi).

Maruti Suzuki Ritz’s Namesake

Here’s an interesting piece of information about Maruti Suzuki’s latest small car for the Indian car market called the ‘Ritz’. Before 15th May 2009 (its date of launch), the hatchback was eagerly awaited and was extensively referred to as ‘Splash’ by the media. Somewhere in between, Maruti Suzuki was forced to rename and launch the car as ‘Ritz’ even though the same car is known as the Suzuki Splash in the international market.
The reason for this sudden move came after Maruti Suzuki’s sudden realization that the name ‘Splash’ was already registered as a brand by Ford Motors which had already applied for this name in 2002 with the Controller General of Patents Designs and Trademarks Registry in India. Ford India is planning to introduce a small car in the country next year which it wants to market as ‘Splash’.
When Maruti Suzuki approached the trademarks authorities for introducing its new hatchback, its petition was withdrawn and the car manufacturer was forced to rename it as ‘Ritz’. And that is how the Maruti Suzuki Ritz came to be known as the Ritz. Looks like car manufacturers are clashing over more than just the sales of their small cars in India.

China emerging as new world auto power

America's auto titans are dismantling their global empires. But across the Pacific, it's as if the global

economic forces that have pummeled Detroit never struck. Chinese auto sales are up, and China is projected to displace Japan as the world's largest car producer this year.

Now, the auto world is buzzing that China's auto industry may try to pick up the pieces of Detroit at a bargain.

Chinese companies have tried to dampen speculation, issuing regulatory filings that deny bids to buy Ford Motor Co.'s Volvo or General Motor Corp.'s Saab. But there's little doubt among analysts that Chinese automakers are interested in the United States and that Detroit's automakers are interested in them.

Buying up brands such as Hummer or Saturn could supply Chinese automakers with the technological expertise to help them leapfrog past long-established competitors, said Kelly Sims Gallagher, a lecturer at Harvard University's Kennedy School of Government who wrote a book on Chinese automakers.

"That's where Chinese firms are weakest," she said. "They have world-class business and manufacturing capabilities now. What they still lack is technological know-how, systems integration, being able to design new vehicles from scratch and get them to a manufacturing line."

China still suffers from its reputation of being a copycat manufacturer. An acquisition could lend clout to some of the nation's 100 car companies that are largely unknown outside their home country.

Such a deal would be "off-the-shelf legitimacy that you can purchase," said Aaron Bragman, an auto analyst with IHS Global Insight.

The global auto industry is restructuring. Italy's Fiat Group SpA is on the verge of taking control of Chrysler LLC. Last year, India's Tata Motors, already famous for its $2,000 Nano, acquired Jaguar and Land Rover.

And China's auto sector has emerged as a threat to the long-standing pecking order.

Geely Automobile, one of China's largest private carmakers, purchased an Australian drivetrain transmission supplier, a leading gearbox manufacturer, this year. Weichai Power, one of China's top diesel engine manufacturers, acquired a French diesel engine producer. Another Chinese company, BYD, which counts Warren Buffett as an investor, launched a mass-market plug-in electric car, ahead of GM's anticipated Chevrolet Volt.

Detroit's annual auto show in January was somber, but Shanghai's show dazzled attendees with throngs of models, rock bands and light shows. This year, Nissan Motor Co. Ltd. skipped Detroit and attended the Chinese event in April. Mercedes-Benz, BMW AG and Porsche SE all unveiled new vehicle models in Shanghai.

"The center of gravity is moving eastward," Dieter Zetsche, chairman of Daimler, told reporters at the show.

"When we look back 20 years from now, the year 2009 is likely to be viewed as the year in which the baton of leadership in the global auto industry passed from the United States to China," Jack Perkowski, a Western transplant and former chairman of a Beijing auto parts company, wrote in his blog "Managing the Dragon."

Some of China's bigger manufacturers, such as Chery Automobile, have trumpeted their intent to export Chinese-made vehicles to the United States in the next few years. To get there, they'll need to revamp their products to meet stringent U.S. emissions and safety standards.

That's no simple problem. Previous plans to ship Chinese cars to U.S. soil have crumbled. A company called Brilliance missed its goal of launching U.S. sales in 2009. BYD said it would introduce its cars to Americans in 2010 but has pushed their arrival to 2011. Other potential contenders have gone out of business or are struggling to stay afloat.

In 1994, Beijing released a plan to triple auto production by 2000 and reduce imports. The government lured foreign producers to bring their technology overseas and invest in Chinese auto parts firms. It aimed to modernize domestic manufacturing by creating joint ventures with foreign automakers such as GM.

As a result, China's auto sales took off in 2000. In 2002, they crossed the 1 million mark. More recently, the numbers have taken a hit in the economic crisis, forcing companies to curb exports to countries such as Russia and Vietnam.

But after the industry pressed Beijing for a bailout late last year, the central government responded with subsidies and slashed the sales tax on small, fuel-efficient cars, spurring demand. And analysts say the expansion of the country's web of roads and highways — part of an economic stimulus package — coupled with a growing middle class could fuel more sales for years to come.

In April, China's vehicle sales jumped 25 percent, compared with a year earlier, to a record monthly high of 1.15 million units. It was the third consecutive month that China has surpassed the United States in sales.

GM, which has two joint ventures in the country, also hit a monthly record in April with its sales jumping 50 percent from a year earlier. The automaker plans to import cars from China starting in 2011, according to a GM plan circulating in Congress.

But in the United States, auto sales fell 34 percent last month. And GM, which has received $15.4 billion in U.S. government loans, says it is likely to file for bankruptcy protection.

Advanced TDCi diesel engine Ikon launched

Ford India today unveiled the new Ikon with an advanced TDCi diesel engine offering significant improvements ranging from a new advanced DuraTorq TDCi engine offering superior fuel efficiency and fresh, bold European design cues. "The new Ford Ikon continues to be a leader in its segment and caters to customers with a combination of superior fuel efficiency, improved engine performance, best-in-class driveability and exceptional value for money," said Michael Boneham, president, Ford India at the launch. "The introduction of the latest generation 1.4-litre DuraTorq TDCi engine transforms the way the new Ikon drives, and at the same time builds on the current model's core strengths to deliver on customer wants – improved overall performance, better fuel efficiency and lower cost of ownership."

Ford's advanced 1.4-litre DuraTorq TDCi engine in the new Ikon complements the current 1.3-litre petrol engine, offering consumers the choice of two of the best powertrains, tailored to suit Indian driving conditions. The DuraTorq TDCi powertrain delivers 68PS and a stout 160Nm of peak torque. It is the same advanced and reliable common-rail diesel engine used by Ford of Europe. Describing the advantages of the DuraTorq TDCi powertrain, John Lonsdale, vice president, Product Development said, "When you experience the new Ikon first-hand with the DuraTorq TDCi engine, that's when you'll realize the improvements we've made have transformed the way the new Ikon responds to your driving demands."

The new Ikon also boasts of a freshened exterior design with distinct European cues. From the sharper new hood design and striking new headlamps to the all-new front bumper with its larger lower grille and European design cues, it presents a fresh face but one that is instantly recognisable. In keeping with the new Ikon's bold and confident exterior design, Ford India has added a punchy new colour to the exterior palette – Morello – to existing Diamond White, Panther Black, Moondust Silver, Paprika Red, Platinum and Brush Steel.

The new, modern instrument cluster on the diesel variant incorporates new graphics, tachometer, LED needles and LCD odometer display. The new Ikon meets Ford's stringent crash requirements, which exceed India's local regulatory requirements. It's safety strategy incorporates both front and rear energy-absorbing crumple zones which dissipate the forces generated during an impact away from the occupants.

New Ikon's occupant safety features include :
· Collapsible steering column (reduces intrusion distance)
· Front seatbelt web-grabbers (prevent uncontrolled movement)
· Anti-submarine seat base (prevents occupants slipping under the three-point seatbelt during an impact)
· Front and rear side impact door beams
· Laminated direct glazed windscreen
Security is ensured with a multi-faceted anti-theft protection strategy :
· Central locking (includes fuel filler cap)
· High security lock sets for doors and boot lid
· Steering column lock
· Child locks

The new Ford Ikon comes with a best-in-class two-year/100,000km warranty, and will have a price of Rs 5.19 lakhs ex-showroom New Delhi.

New Ford Ikon receives overwhelming response in India

The newly launched Ford Ikon has received a fantastic response from Indian car enthusiasts across the country. Proving its popularity in the segment, the Ikon has already registered over 2000 bookings in less than a month since its launch.

On November 5, Ford India launched its new Ikon range, offering significant improvements ranging from a new advanced DuraTorq TDCi engine with superior fuel efficiency, to stylish and fresh looks drawn from bold European design cues. Complementing this is the class leading warranty and significantly lower cost of ownership that the new Ikon boasts of.

Timothy Tucker, vice president, sales, Ford India added, ``The new Ford Ikon has received terrific reviews across the country and is testament that the company have its fingers strong on the pulse of the customers. Dealers across India are echoing of heightened consumer interest and dealerships such as Kairali Ford, Bhagat Ford, Harpreet Ford, Rajshree Ford and MPL Ford have shown exemplary efforts in registering maximum bookings. The company is confident that the Ford Ikon will continue to post excellent sales results in the coming months as well.``

Ford has introduced the advanced 1.4-litre DuraTorq TDCi engine in the new Ikon to complement the current 1.3-litre petrol engine, offering consumers the choice of two of the best power trains, tailored to suit Indian driving conditions.

The new Ford Ikon has real appeal for those looking to complement their lifestyle with an energetic, stylish, affordable mid-size sedan.

Ford India is a wholly-owned subsidiary of Ford Motor Company, a global automotive industry leader. Ford India manufactures and distributes automobiles made at its modern integrated manufacturing facility, at Maraimalai Nagar, near Chennai. With more than 2100 employees, the company`s models include Ikon, Fusion, Endeavour and Fiesta.

Renault Itching for a Return to the U.S.

French car maker Renault SA is still itching for a move into the U.S. automobile market -- the world's biggest, from which it has been absent for more than 20 years -- and might be interested in Chrysler LLC if its owners were to put it up for sale, a senior Renault official said Thursday.

Jacques Verdonck, Renault's vice-president for corporate and strategic planning, told Dow Jones Newswires that one option for the company is to try to establish a presence in the U.S. by itself, although this would be both "risky and costly."

That is because it would involve developing at least three new products specifically designed for the U.S. market, while creating a dealer network, either by forming an alliance with an existing dealership network or creating Renault's own network from scratch.

The other easier and less onerous way would be to link up with one of the large U.S. automotive companies, though this would imply that the partner is in good financial health and is sufficiently robust to carry the deal through, he said.

In 2007, talks between Renault and General Motors Corp. about a possible alliance collapsed after management of the two companies failed to see eye-to-eye on the potential synergies that could be derived from an alliance.

"We had discussions in past with GM that didn't work out even though there were considerable potential synergies," Mr. Verdonck said. "If the opportunity presents itself again, we will seize it. But if it doesn't, I don't believe we can launch an aggressive takeover operation against an American company."

In 1982, Renault took over American Motors Corp. to make the Alliance, a variant of Renault's subcompact Renault 9 car, but the project never made money and Renault backed out and sold off its interest to Chrysler Corp. five years later.

While a straight takeover is only one of several scenarios, he acknowledged that Chrysler "would make a good partner" in the U.S.

Potential synergies are different when you consider Chrysler, GM or Ford Motor Co., he said. Chrysler is more focused on its U.S. operations, while GM and Ford are more global players, he noted.

"What's important in a partnership is to ensure that management really wants to be in the partnership; if you do it against the will of the partner, you'll face huge difficulties," Mr. Verdonck said.

Renault Chief Executive Officer Carlos Ghosn said earlier this year that now is not the time for Renault to make a bold move into a new market such as the U.S., arguing that the company must first ensure the success of its industrial expansion in Morocco, in Latin America, India and Russia.

Ford sets early 2010 target to launch small car in India

Armed with a $500-mn investment outlay, Ford Motors has set early 2010 as the target to launch a small car in India, start its new engine-making unit and double the assembly line capacity, a top official said here.

The US-based giant will also unveil its refurbished Ikon by next month to expand its range of offerings in the country that includes Fusion, Endeavour and Fiesta, said Michael Boneham, managing director and president of Ford India.

"Ford now has a presence in only 30 percent of India's automobile market segments. We are entering other segments too. These are exciting times," Boneham told IANS at the company's factory at Maramalai Nagar on the outskirts of the Tamil Nadu capital.

"We are also commissioning a new engine manufacturing unit. It will serve both the domestic and global markets. It will have the flexibility to produce diesel and petrol engines. The idea is to go for higher localisation in the months to come."

Speaking about the small car project, the Ford official said it was being designed and developed specifically for India by a global team. "It will meet the needs of Indian conditions - like water wading, air-conditioning and emission standards."



While declining to divulge any further information on the project, Boneham said it will have a sub-1.2-litre engine with a length of no more than four metres to avoid higher taxes. "It will be very, very competitive in that segment."

Ford's first offering here was the "Josh machine" Ikon that rolled out in 1999 from this city, often called the Detroit of India for hosting auto companies like Hyundai, BMW, Mitsubishi, Ashok Leyland, Caterpillar, TVS, Tafe and Same.

Nissan and Daimler are among some global players that have definite plans to set up their units in this city.

Boneham said the company's integrated engine plant for 250,000 units per annum will be its first outside Europe and will make low-displacement engines for cars to be rolled out of its Indian plant for both domestic market and exports.

He said the existing $26-mn diesel engine assembly plant, with a capacity for 50,000 diesel and 10,000 petrol engines for Fiesta and Fusion, would be eventually integrated with the new plant.

The company has the capacity to assemble some 100,000 cars per year at its facility here, which will be doubled to 200,000.

Queried about the future of its tie up with the Indore-based Avtec that supplies 1.6 litre petrol engines, Boneham said: "We will continue to work with them. We will look at sourcing components from Avtec."

He also sought to dispel the perception that the cost of ownership of Ford cars was high compared with those offered by Japanese and South Korean companies, as several factors like fuel efficiency and servicing were also involved.

"As per our study, in some parts we are costlier and in some others we are cheaper. Overall, we are very competitive in this area. We are working to lower component costs further. Our diesel engine is more fuel efficient than many others," he said.

"High localisation is intended to achieve that. We are extremely quality conscious. Today, we can say we are far more satisfied and comfortable with our vendors."

Carmakers offer gifts and gold to lure customers

It’s raining gold in the car market. Fighting sluggish market conditions, carmakers are offering diamonds sets, gold coins & chains, silver plates and MP3 music systems to lure customers into their showrooms before the festive season.

Traditionally, festive season has meant free insurance covers and auto accessories for buyers. However, this time around, carmakers such as Hyundai Motors and Ford India are offering precious metals to attract female customers and new buyers. Hyundai Motor India (HMI) is offering a free gold coin with its entire range (except i10 AT and Getz 1.5L CRDi) and an MP3 player with the Verna sedan range and the 1.1L & 1.3L Getz hatchback cars.

HMI managing director HS Lheem said: “We are offering these gifts as part of our successful decade-long operations in India. Besides, with these valuable offerings, we’re making Hyundai products very attractive for our customers.”

While Ford Motors India, which recently gave a facelift to Fiesta, is now offering Tanishq diamonds worth Rs 20,000 with every Fiesta. It has also started special offers including cash incentives for corporate and public sector buyers.

Car sales have nosedived in the past two months after a three year-long growth drive. While sales grew 3% in July, August saw a 1.71% dip year-on-year. To fight the slowdown, other companies are taking different routes to tap the market. Maruti Suzuki India has launched special incentives to attract over 25.4 lakh employees from the insurance, banking and retail sector with additional discounts of Rs 17,000 on SX4, Rs 5,000 on M800 & Alto, Wagon R, Estilo and Rs 4,500 on Swift (petrol version).

“It is a tough time and we are concentrating on non-core markets. Banks, financial institutions and insurance companies make up a big market, but still remain tapped. We are directly giving cash discounts to customers in place of tangibles,” a senior executive of Maruti said.

American auto major General Motor has also followed the similar path offering huge cash discounts. The highest cash rebate of Rs 58,000 comes on the Spark compact car, followed by Rs 46,000 on Tavera multi-utility vehicles. Other pre-Diwali offers include Rs 28,000 discount on Optra Magnum sedan along with a 4-5% interest waiver on all loan deals.

Honda Siel Cars India (HSCI) has plunged into the discount market for the first time and has waived 50% insurance premium on its popular City and Civic sedans, besides offering comprehensive warranty and service packages to the customers.

Volvo plans to launch new models in India

Volvo Car India (VCI), a division of Ford Motor Company, is planning to strengthen its dealer network and launch new models in the Indian market, the company’s Managing Director Paul de Voijs has said.”Currently we market our products in India through three dealers: one each in Delhi, Mumbai and Chandigarh. Now we are planning to expand our business in places like Hyderabad, Bangalore, Pune and Cochin. We will disclose our business details within the next two weeks,” Voijs said here Saturday.

“We will monitor our business progress in India for one more year then based on the response we may also open an assembly unit at some appropriate place in India,” he said.

However, all this depends on the response and support that we will get from Indian business facilitators.

“Permits for constructions and other business requirements here are very complex and vary from state to state,” he said.

Eyeing the rich Punjab market, Voijs said: “Punjab is one of the flourishing states of India and we consider it as a potential market for us. We are particularly planning to intensify our business operations in this state. I believe that the rich populace of Punjab prefers quality products and the unmatched Volvo cars will be the first choice for them if we market well in this region.”

VCI has ten luxurious models in its portfolio and they have plans to introduce 2-3 more models by the end of this fiscal year, Voijs said.

He said VCI believes in direct marketing and direct promotional activities right at the doorstep of the potential buyers rather than blind advertising. We intend to sell 400 to 500 Volvo cars in India by the end of this fiscal year.

“The Volvo Ocean Race will also cross India this year for the first time to promote the Volvo brand,” Voijs said.

The Volvo Ocean Race is an yacht race that goes around the world and is held every three years. This year it is being sponsored by Volvo.

The race starts from Spain and runs for 8-9 months covering various countries across the globe. It will cross Kochi at the end of 2008 and will finish in Russia in 2009, Voijs said.

VCI presented its S80 3.2 model car to India’s first Olympics individual gold medallist, Abhinav Bindra Saturday.

“We will also try to promote sports in India. Indian boxers have also done well in the Olympics, we will also try to felicitate them in the near future,” he said.

Ford plans to roll out small car by 2010

WITH US automaker Ford’s Indian subsidiary announcing its intention to launch a small car in India by 2010, the Indian small car market is set to witness an explosion of small cars. Carmakers are racing to get products on the road by 2010, with global auto giants like Honda, Nissan, Daimler Chrysler, General Motors and home- grown Bajaj Auto all announcing plans to launch their small car by 2010. Tata Motors’ ultra low- cost ‘one lakh rupee car’ Nano, unveiled in January this year, has ignited competition in this sector, hitherto dominated by Maruti Suzuki.

By 2010, the demand for cars is expected to almost double to two million a year. Said Michael Boneham, managing director and president ,Ford India, “The small car segment has 75 percent share on the Indian market, and when we launch the small car, that’s when the real volumes will come in.” This shift in Ford’s strategy is touted by analysts as a global business strategy adopted by other global automakers like Nissan, Renault, Toyota and Honda. All these have acknowledged the merit and scope of producing an ultra low- cost car (ULC). Besides this, looking at factors like fuel economy and volumes, global auto companies are under pressure to target this growing segment, analysts say. Ford’s small car will most likely be sold with diesel and gasoline engine options, Boneham said, on the sidelines of a news conference, to launch an upgraded range of Fiesta sedan cars.

Ford’s new engine manufacturing facility will be set up in 2009- 10 with a capacity of 2,50,000 units per year. “The plant will fulfill the entire domestic demand and will also cater to the needs for ford in the Asia Pacific region,” said Boneham. Ford currently produces the Fiesta, Ikon and Fusion sedans, and the Endeavour SUV in India. The company had recently shut plants and cut workforce in North America amid financial losses. It has announced plans to invest $500 million in India to expand production capacity and make the new small car.

Ford is also exploring the possibility of introducing eco- friendly vehicles that run on alternative fuels or hybrid cars in the Indian market. According to the McKinsey Global Institute, consumers in the Rs 90,000 to Rs 2- lakh- a- year salary bracket will form the largest portion of India’s income pyramid in 10 years. These form the target for Tata’s Nano. Now, even global auto makers are targeting this segment. Toyota Kirloskar Motor (TKM), a joint venture between Japan’s Toyota Motor Corp. and India’s Kirloskar Group, also plans to invest Rs 1,400 crore on anew plant in Bengaluru, from where it will roll out its small car in abid to tap the largest segment of the car market in India. Said Vaishali Jajoo, auto analyst, Angel Broking, “Growth for global auto markets in developed markets is in single digits, whereas the small car market is projected to show a double digit growth in the coming five years. Besides this the (small car) market contributes over 50 per cent to the overall car sales in the country. Factors like cost efficiency are also a big push for global biggies.” The move has also set off a flurry of activity among component vendors, with most original equipment manufacturers (OEMs) gearing up their volumes for small cars to be launched by Renault- Nissan, Bajaj, Honda, General Motors and others.

Diesel powers India’s car sales growth

THE markets may be gripped by fears of an economic slowdown and the government by inflation worries, but the Indian consumer’s love affair with automobiles shows no sign of ending. Despite rising fuel prices, India’s automobile sales grew 8.09 per cent in May, 2008, according to data released by industry body the Society of Indian Automobile Manufacturers (SIAM).

Passenger car sales in the domestic market jumped 14.26 per cent, while total two wheeler sales were up by seven per cent during the month. With the price difference between petrol and diesel going up further, the sale of diesel cars is expected to accelerate vis- à- vis the petrol versions. According to industry sources, the current ratio of car sales in models such as the Swift that is available both in diesel and petrol variant is 60: 40. This means that out of every 100 units of Swift sold 60 are powered by diesel engines, while 40 are petrol versions. Sources disclosed that in the case of Maruti's Dzire the diesel version accounts for nearly 80 per cent of sales while the petrol variant makes up 20 per cent. The new generation diesel engines are a vast improvement over the older ones, which were prone to heavy vibrations and were also noisier.

Ford Motor Company, for instance, has started registering a sharp increase in car sales after it introduced its latest diesel models. The fact that technology is an important factor is reflected in the fact that Tata Motors has reported flat growth even though the company mainly markets diesel models. The company sold 14,228 units in May this year compared to 14,217 units in the same month last year. Mahindra & Mahindra (M& M) has reported a12.98 per cent increase in domestic sales during May at 19,296 units, up from 17,079 units in the same month last year which also goes to show the increasing popularity of diesel vehicles. The company mainly produces SUVs although it has introduced the Logan car recently as part of a joint venture with Renault.

Diesel is Rs 15.76 per litre cheaper than petrol in Delhi and modern diesel engines also give higher mileage per litre than petrol engines, which brings down the running cost of diesel cars even further. However, diesel engines normally cost more to maintain than petrol engines. Each time the government raises the price of transport fuels, the price of petrol goes up more than that of diesel, as a result of which the gap has been widening over the years. The reason is that petrol is still perceived as a rich mans fuel while diesel, which is used in the farm and public transport sectors, is considered politically sensitive.

According to sources, diesel cars have a20 per cent market share in India at present. However, diesel as a vehicular fuel comes in for some criticism from environmental groups on the ground that it is more polluting than petrol. But the car companies claim that modern diesel engines emit less carbon dioxide than petrol engines and the emissions are less harmful. Both Maruti and Hyundai have also introduced alternative fuel options such as LPG and CNG this month in anticipation of some buyers opting for these models as these are cheaper to run than the petrol versions.