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Old 14th March 2013, 12:36   #1
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Default Chevrolet's losses at Rs. 1598 crores in India

Today's Economic Times carries an article on the woes of GM in India: 18 years and still clueless.

http://economictimes.indiatimes.com/...w/18961932.cms

Spark, Cruze, Tavera and Captiva, once segment leaders, have seen a sharp fall in sales. In spite of a product in every segment, volumes still elude GM. IMHO neither the Sail hatchback nor sedan is going to change their fortunes. Where do they go from here?
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Old 14th March 2013, 12:43   #2
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Default re: Chevrolet's losses at Rs. 1598 crores in India

This is on expected lines, the Cruze apart GM's range in India is aging/overpriced/boring with a perception of being unreliable. The Indian operation is mostly Chinese, I don't expect anything exciting from GM in the future, unless they plan to launch Cadillacs with diesel engines, they will just coast along. The SAIL is the new symbol of boring.
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Old 14th March 2013, 13:46   #3
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Default re: Chevrolet's losses at Rs. 1598 crores in India

Wasn't it actually expected? Apart from the Cruze and the beat diesel ( in a minor capacity) they have got all the other offerings wrong. They let go off a wonderful oppurtunity with the Spark which had shown much promise at the time of its launch. The UVA, Optra etc were all market duds, more or less. The Tavera which also saw some good numbers initially lost out in the long run. Probably they need to relook at there marketing strategy. As a member here, I might not be able to name all there cars in India. So won't be surprised if there cars do not figure on the list also of many car buyers.

Hopefully this will change with the new Sail sedan.
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Old 14th March 2013, 13:57   #4
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Default re: Chevrolet's losses at Rs. 1598 crores in India

In India if one wants something simple, reliable, bland, safe(as an expense), economical etc. one gets a Maruti Suzuki (Except the Swift - expensive with good looks) - 50% market share. Then there are other brands with each brand and each model that does well having character and a different atribute to offer. GM cars are not the cheapest to buy, not the best to drive, don't have the best ride, nor the best looks, nor the best fuel efficiency, nor the bet service support, nor a premium image or the best reliability - so why would one get a GM Vehicle, the ones that did well for a while had something more to offer - Spark - Cute, Cruz - Power & Looks, Optra class and comfort ahead of the others at the time of launch, Beat - radical looks and a diesel option later on, Tavera - cheap to run for tourist business.

Where to the Sail and Sail UVA stand out? They need to. If Indians want a vehicle and there is nothing to stand out in it then the safe bet is supposed to be Maruti and attempting to beat them at this will not meet much success. Also if a one is going to drop prices later when the car does not sell it invariably is too late.
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Old 14th March 2013, 16:03   #5
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Default re: Chevrolet's losses at Rs. 1598 crores in India

My two cents - Since inception, GM has not been able to build a brand (with values) which the Indian consumer can associate with. Even today, after spending close to a decade in the Indian market, they don't have a flagship model. They have to hover their cars around the Chevrolet brand but many things including marketing, positioning, price differentials etc. have been diffused...add to that the frequent price cuts and the customer loses faith quickly. And with the economic conditions not improving greatly, GM has a lot to worry about in the future. To make matters worse, the company's MD Karl Slym quit GM last year. Karl was instrumental in making the 3 year / 100,000 km warranty clause famous for GM cars.
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Old 14th March 2013, 16:07   #6
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Default re: Chevrolet's losses at Rs. 1598 crores in India

And the same story will continue if they keep launching duds like the Sail. That, I felt was a botched opportunity. The racier Sonic hatch and sedan with the more contemporary engines would have been the ideal cars to battle with cars like the Swift and i20.
I'm sure that the GM marketing team pulled out various multi-colored pie charts showing that these Chinese collaboration products are ideal for the Indian market. And they haven't got the message yet. Apparently, there's a ridiculous looking thing called the 'Enjoy' in the pipeline. One just needs to take a look at a photo and see that it won't sell.
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Old 14th March 2013, 16:15   #7
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Default re: Chevrolet's losses at Rs. 1598 crores in India

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Originally Posted by amitg79 View Post
And the same story will continue if they keep launching duds like the Sail. That, I felt was a botched opportunity. The racier Sonic hatch and sedan with the more contemporary engines would have been the ideal cars to battle with cars like the Swift and i20.
I'm sure that the GM marketing team pulled out various multi-colored pie charts showing that these Chinese collaboration products are ideal for the Indian market. And they haven't got the message yet. Apparently, there's a ridiculous looking thing called the 'Enjoy' in the pipeline. One just needs to take a look at a photo and see that it won't sell.
+1, the cars are so boring and nothing to be excited about. The upcoming Enjoy will be definitely a market dud and will eventually be used for call centre employees. IMO, Sail was a disaster. A good opportunity lost by GM to get some foothold in the cut throat market.
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Old 14th March 2013, 16:51   #8
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Default re: Chevrolet's losses at Rs. 1598 crores in India

What happened in the past few years in India is amazing.
1. First time car buyers kept getting younger and younger - and not necessarily looking for cheap cars. They look for snazzy designs, compact fits, up to date in terms of features. Stuff that cars like Eon offer (guessing!). Beat was that car a few years ago, not any more. Not expensive but just compact, pocket friendly and fun.
2. Buyers with money got their pockets lined even deeper and could afford the best of the best. So luxury cars got a kick in sales. A Merc didn't get wows any more. You had BMW, Audi, Jaguar lining the roads every now and then. The more we saw them the more people like me want these cars and if not these cars, want at least some of these features in their everyday cars. Look at what Hyundai does today - all loaded!!
3. Rural India's got money, more than what we imagine. Luxury cars aren't only seen Punjab hinterland. So now folks even in the tier 2-3 towns, who can afford cars want scorpio's, duster's and the works. No more fooling around these folks by churning products already expired elsewhere.
4. Middle class isn't really in the middle any more. Everyone (at least in IT) is well heeled, well traveled and perhaps owned a car or 2 during their stay abroad. This whole experience of owning cars in US makes us cringe at what gets offered to us as premium features on top ends. Or what we miss out in-spite of paying the premium (ala duster).

So i guess its not just Chevy, the list of duds and manufacturers churning out these duds is fairly long. The only two who i see buck the trend most of the time are MSIL & HMIL. The rest are either eating dust or remain 1 or at best 2 trick ponies.

Didn't mean to be a thesis, just what i felt from my own experiences!
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Old 14th March 2013, 17:52   #9
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Default re: Chevrolet's losses at Rs. 1598 crores in India

Not surprised at all after hearing this. For last many years, GM is trying to sell outdated designs here. Look at there cars like Tavera, Aveo Uva, Now Sail Uva etc. There designs don't attract many people. Spark & Beat are good but not that good like Alto, Swift & Wagon R which will run the company for years with tremendous volumes. Now also there only upcoming model is Enjoy which is a flop before launch unless they price it very attractively. They have clearly failed to understand the market in India. Lets see how company is going to do in coming years, i am not hopeful at all
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Old 14th March 2013, 18:06   #10
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Default re: Chevrolet's losses at Rs. 1598 crores in India

They first launched the fresh looking beat, but couldn't get the volumes due to the delay in getting the diesel version. They have now launched Sail in both diesel and petrol but lost out on the looks and equipment dept. And naming it an UVA is another disaster (reminds me of Tata's obsession with the Indica moniker).

Just like Tata Motors, GM needs to revisit their product portfolio and bring in a couple of fresh products to revive its fortunes.

BTW, do they have a car in the pipeline to compete with the Duster or EcoSport? Cant recollect any.
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Old 14th March 2013, 18:21   #11
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Default re: Chevrolet's losses at Rs. 1598 crores in India

One more point - They need to built brand recall in minds of Customers here in India.

Most of us still remember what Hyundai did with Shah Rukh Khan & Santro. Though Santro was not a attractive looking car, still it clocked real good numbers. Today Hyundai is one of the respected brands in India.

But a large majority of people in India might know that Chervolet Brand is owned by General Motors or vice versa. I mean today when people see a Santro or Verna, they remember it is from Hyundai.

Also will have to find a hole in market, just like what Toyota did first with Qualis & then with Innova. Toyota was absolutely spot on in finding a need of passenger & missing product in the market to match that need. This made their Car - Qualis & Innova market leaders. Same goes with Renault Duster, which made it a instant hit.

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Old 14th March 2013, 19:15   #12
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Default re: Chevrolet's losses at Rs. 1598 crores in India

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Originally Posted by veyron_head View Post
BTW, do they have a car in the pipeline to compete with the Duster or EcoSport? Cant recollect any.
There were talks of the Trax being looked at for India. But don't know whether or when they will launch it.
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Old 14th March 2013, 19:53   #13
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Default re: Chevrolet's losses at Rs. 1598 crores in India

In my opinion, GM lost out because they could not localize their car's spares as per the market rates. Even now, the Chevy spares are more expensive than say a Maruti or Honda. Moreover, they could never improve the cost of servicing and dealership. Also, factor in that their dealership reach is very limited. Well, add it to the bland looks of their cars, less features etc.
I believe it is because of these very reasons, they went bankrupt in US and now close to doing that here in India. American companies like GM and Ford should really understand the market conditions in India.
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Old 14th March 2013, 23:03   #14
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Default re: Chevrolet's losses at Rs. 1598 crores in India

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Originally Posted by JoshMachine View Post
My two cents - Since inception, GM has not been able to build a brand (with values) which the Indian consumer can associate with.
That is incorrect or rather unnecessary.
When Cruze was launched it sold like hot cakes. It ruled the market for 2 years. Could any Maruti/Hyundai car do it? No.
So when a 12-14L car does not need a brand to sell, why the hell will a 4-6L Hatch/ 7-8L sedan need?



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And the same story will continue if they keep launching duds like the Sail. That, I felt was a botched opportunity. The racier Sonic hatch and sedan with the more contemporary engines would have been the ideal cars to battle with cars like the Swift and i20.
You are right, but I don't think that even a sonic hatch would sell. Since they would happily plonk the 1.2L petrol and 1.3L diesel.
It would suffer the same fate as Beat. To explain let us see why the Beat did not meet with success. For starters it is a hell of a car for the price it asks for. It looks brilliant/radical both inside and out. Spares are priced similar to Marutis. But having owned it for 3 years I can tell why it is a failure. It has got too much competition. And it does not stand out of the crowd (except the looks). It is not a driver's car at all. The Figo & Swift are more like it. It is not a car for people sitting at the back due to its serious lack of under thigh support & claustrophobic rear window. Here the Figo, I20 and even the swift fares better.
There is also 2 more cars similar to Beat. Radical in design with decent interiors. The A-Star & Ritz. That too with a better handling package & Maruti tag fails to make a dent in the market. What hope does a Chevy have.

Bottom line: If you offer me anything similar that Maruti or Hyundai offers, I have no reason to overlook their service network. If they dont I will have no other choice than to stick with you. Hence Cruze in the only car that is successful from the Chevy stable.

Now though it has got competition from Jetta & Elantra. So it is curtains for you my friend.



Quote:
Originally Posted by amitg79 View Post
I'm sure that the GM marketing team pulled out various multi-colored pie charts showing that these Chinese collaboration products are ideal for the Indian market. And they haven't got the message yet. Apparently, there's a ridiculous looking thing called the 'Enjoy' in the pipeline. One just needs to take a look at a photo and see that it won't sell.
I suppose they follow "Don't learn from your own mistakes"
How can you expect then to "Learn from other's mistakes" -- Nissan Elavia

Quote:
Originally Posted by sukhoi30 View Post
In my opinion, GM lost out because they could not localize their car's spares as per the market rates. Even now, the Chevy spares are more expensive than say a Maruti or Honda. Moreover, they could never improve the cost of servicing and dealership. Also, factor in that their dealership reach is very limited. Well, add it to the bland looks of their cars, less features etc.
I can not comment too much on localisation but at the price they are offering Beat & Cruz, they could not have done it without localisation.

I am sorry. Chevy sapres are not at all expensive and very much at par with market rates. Then there is a 3 year maintenance package at a very reasonable price. They also give a standard 3 years warranty. What else do you want.

Bland looks. They got over it with Beat & Cruze. But then all of a sudden, all hell broke loose. We got the sail from grandpa age.

Last edited by oxyzen : 14th March 2013 at 23:08.
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Old 14th March 2013, 23:59   #15
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Default re: Chevrolet's losses at Rs. 1598 crores in India

I guess the Tavera, which rakes in about 2k units per month got a new lifeline only because Toyota discontinued Qualis. All taxi guys and company cabs rushed to book a tavera in the absence of the Qualis. It does not have any serious MUV contender in its price bracket other than the rarely seen of Sonalika Rhino.

Last edited by nettooran : 15th March 2013 at 00:02.
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