10 most expensive cars available in India
India was one of the few glaring white spots left on the card Volkswagen the world, and amid all the euphoria surrounding the developing economies at the time, Booz Company analysts predicted the country would exceed Germany to become the fourth largest car market in the world by 2015 with a volume of more than 5 million vehicles.
The schedule, Volkswagen has added a third shift to a new plant in Pune in April 2011, churning VW Vento and Skoda Rapid sedan specially designed to meet the tastes of Indian car buyers Large scale manufacturing facility opened two years soon after the end time back to 580 million euros, the plant represents the single largest investment by a German company in India.
For nearly three-quarters of new car sales in India are bought with loans, an unusually high level of funding much more common in mature markets, Volkswagen has obtained regulatory approval to begin offering its clients customized packages financing and leveraging its global scale, diverse product range and decades of experience in emerging markets such as China and Brazil, the band seemed well on its way to position itself as a major player on the subcontinent Indian, quickly catch rivals such as Toyota and Honda, which has already enjoyed great start.
Fast forward today and the VW group serves as a warning to other European carmakers such as PSA Peugeot-Citroen, who are planning another foray in India.
The market declined last year from 8 percent to 2 55 million vehicles, to return to the 2011 level, after the interest rate on auto loans rose to about 12 percent in the middle of a sale monetary crisis of VW and Skoda cars fell even more drastically from the VW group decreased and the automaker has quietly set aside too ambitious after misjudged political risk management, muddled strategy brand and model sloppy and the two queues of the powertrain.
We want to be a major player in the Indian market, too, however, we focus not on the mere market share, said Mahesh Kodumudi, head of VW Group India, in reply to questions e-mailed to the automotive News Europe.
VW is not the only automaker to stumble as India remains one of the most difficult automotive markets in the world, having more of a European victim Peugeot was one of the first to enter the market , assembly of 309 in mid-1990, heavy losses, a month long labor dispute at its Kalyan plant and problems with the first local partner prompted Peugeot back on the market only a few years later was Fiat undermined by multiple changes in its strategy in India over the years, while General Motors simply pulls the plug from the German brand Opel it in 2006.
The high demand for the Duster showed Renault's best selling European brand in India Pictured is a ceremony in a Renault dealership in Chennai intended to bring good luck to a new vehicle and its owner.
After ditching its joint venture with India's Mahindra four years ago and the launch of a series of flops, Renault has finally landed a hit with its Duster, one of the only affordable SUV on the market thanks to call the Duster with the country is extremely profitable customers conscious middle class, Renault is the No. 1 European brand in the market, however, still only sold about 24,000 vehicles in India during the first half, according Focus2Move data, 90 percent of that volume came from the cloth While the German premium brands Audi, BMW and Mercedes-Benz dominated the luxury segment of the country, their success means little given that the top models range represents only 2 percent of the global market demand.
A man cycling past Mercedes dealership Mercedes New Delhi was the best-selling European premium brand in India in the first half, but No. 15 overall.
Part of the problem for European automakers is their inability to reduce their production costs through economies of scale with Maruti Suzuki capturing 44 percent of the market and Hyundai another 16 percent, the remaining dozen or so brands cars are competing for just over a third of the market Subtract players grade and leaving about 800,000 unit sales, which are distributed 12 most ways this volume in the segments of small and very minicar costs competitive.
This is a very small fragmented cake that is divided So if the market becomes slower earnings will be badly hit, said Mohit Arora, executive director at JD Power Asia Pacific I do not think that most European manufacturers or even American in India are cost effective at this time.
In an attempt to gain scale, automakers are forced to turn their Indian factories in VW export centers, for example, now sells Vento in 32 other markets, such as Mexico, just to keep the plant operating at about 75 percent capacity utilization, a level generally considered necessary for a plant to break even about half of the production of VW's Pune plant is destined for overseas markets this year.
Another problem is the difficulties and the unique pitfalls associated with running a business in India, a country whose recent rapid growth masked the deep structural problems in the economy in general and the transport sector in particular.
Home 1 2 billion people, and the third largest economy, India has long been considered by automakers as the next China because of the emergence of the middle class and educated overwhelming majority young Although the untapped potential of Asia is massive with about 20 cars per 1,000 people less than half the poverty level in China remains endemic rivals in India's per capita income of some sub-Saharan African regions and one third of the poor live in the world of country fuel costs remain a major concern, leading to the popularity of diesels and minibuses Thrifty roads can t keep up car sales, poor surfaces and traffic conditions may require dealers to maintain solid spare parts and service network and the congestion is actually used a natural bottleneck the demand of the country's infrastructure needs are enormous, the World Bank in a report.
Because few people own cars, tastes are not yet mature, making it difficult to predict the behavior of Indian car buyers are easier to impress with one model as the Duster India own Tata Motors horribly hurt when he made a huge bet that families traveling on the back of a scooter would be happy only trade in their two-wheeled vehicle for the comfort of a car they could afford a visionary response Tata Nano, flopped buyers feared the stigma attached to a vehicle marketed as the cheapest car in the world.
Automakers complain a lot about the difficulty stems from the own inflexible bureaucracy of India, the chronic lack of reform of the offer, many prices and a government to use all means necessary to increase tax revenues Study published by the consulting firm McKinsey in February, for example, criticized the complex and archaic regulations of India, tax regime and balkanized web of at least 43 national laws and many other state laws governing working conditions manufacturing sector of India is characterized by an overabundance of sub-scale, low-productivity firms, McKinsey said.
Companies with more than 100 employees on payroll must obtain government approval for layoffs, encouraging harmful creation of a work force with two levels that raises social tensions between permanent staff and their lowest paid India contract brothers lose more days each year as a result of strikes and lockouts than any other country, employers' association AIOE wrote in a study published in 2012 just weeks later, further clashes in a Maruti Suzuki plant cost the life of a human resources officer, the fourth manager of the automotive industry to die at the hands of its own employees since 2008.
While Volkswagen has achieved initial boom thanks to the Vento and Rapid, growth began to slow in 2012 after management failed to locate a key trend that emerged due to changes in the regulatory environment for reduce traffic on congested roads and take control of the fiscal expansion and trade deficits by reducing subsidies and crude oil imports, the Indian government lowered excise duties for vehicles under 4 meters equipped with small engines such as carmakers Maruti Suzuki took on the launch of the popular sedan Dzire.
After the change in the regulatory environment, the two fastest growing segments of the Indian car market are sedans and sport utility vehicles under 4 meters and we currently have nothing to offer, a source said VW While other brands imports are already successful with their sub-4 meter cars, such as Honda Amaze sedan and Ford EcoSport SUV in Wolfsburg could only muster study Taigun SUV at Delhi motor Show earlier this year Worse, VW has been slow to offer a competitive diesel engine only with the July launch of the refreshed Polo sedan VW will begin offering a turbo-diesel 1 5 liter specially designed to meet the requirements of the Indian excise tax VW announced it would begin soon the construction of the engine in Pune, to avoid incurring import duties.
Consequently, the Polo is the only car in the range of VW receives the excise tax as low as possible 8 percent Unfortunately for Volkswagen, tailgates are not at slightly longer style, derived Polo Vento sedan by comparison, is slapped with a 20 percent load, a huge difference for buyers of Indian cars cost sensitive.
Of course, demand could swing in the other direction Delhi should decide to reduce the gap in the tax treatment To strengthen our presence on the Indian market, we need a broader product portfolio, Volkswagen said Kodumudi considering options for new models in these segments sub-4 meter sedan and SUV, but no decision has been taken yet.
VW Group has made things worse by too willingly sacrifice Skoda volumes to align its brand in India strategy with the rest of the world, where its flagship VWs are more upscale than the Czech language group brand in India, however, Skoda is considered an aspirational brand that has an upscale cachet that dates back to its inception in 2001, the effort to reposition below VW did not go over well with customers and Skoda brand sales in India suffered you can have a strategy that you can explain eloquently the investment community, but the man in the street believes Volkswagen is here to kill Skoda as a brand, said an analyst based in India who asked to remain anonymous ultimately, the automaker ended with some VW models were priced at a premium Skoda, and others that were priced at a discount, that confused customers, analysts .
VW was forced to lower its targets for India, for the purpose of market share in the high percentage of single digit range for all brands instead by double-digit hoped earlier for back in 2009 when Pune continued stream, there was a phase of euphoria surrounding emerging markets like India, but the economy and Conditions of developed much differently than the assumptions made at the time, so we had to adjust our goals, the VW source said.
VW is not the only European automaker to have difficulty in penetrating the Indian market combined with Tata Fiat, building and selling cars in a joint venture to decide to set up an exclusive showrooms network with aim to have 150 dealers by the end of this year but the service problems and a range of products which currently includes only two models have limited its growth given the crowded state of the market, IHS Anil Sharma auto analyst recommends the PSA of France to avoid the barriers to entry in the volume segment by returning to India using its premium brand DS as an alternative to more mainstream Germans.
Overall, the outlook for car sales in India is brightening, even for the pro-Minister of VW Group Gujarat came to power in national elections after promising that the good days are ahead, put his party the first absolute majority for decades.
The overwhelming election victory by Prime Minister Narendra Modi, combined with the governor Raghuram Rajan at the RBI head of India's central bank, is a potential game changer for India, Japanese brokerage Nomura said it would no exaggeration to expect India to stand out as the largest emerging market EM turning history over the next five years, car manufacturers in India are also happy, calling the budget proposals of the new government the right Modi message to the foreign investors auto sales rose in May for the first time in over 15 months, according to the India association SIAM vehicles, helped by an extension of the reduction of excise duty for cars up December 2014.
The changes also provide an opportunity for European carmakers, as the government seeks to strengthen outdated security rules India has the highest number of road fatalities reported in the world and roughly one out.
May 3 accidents resulting in a fatality that most cars do not have basic safety features such as anti-lock brakes The Volkswagen Polo is the first car in its class to offer airbags as standard equipment in all lines finish If some of those safety standards were to come, European manufacturers could find a more even playing field, JD Power said Arora.
With the government no longer acts as a key part of the problem and part instead of becoming the solution, it is now the European carmakers to execute on their strategies in India.
This story of the current issue of the monthly e-magazine Automotive News Europe, which is also available to read on our iPhone and iPad apps You can download the new issue and past issues here.
German cars available in India, German cars available, India.