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Old 15th April 2014, 17:11   #46
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Default Re: Shocking! Toyota India admits defeat in the small car segment

About time in my opinion.

The Etios and Etios Liva are poor vehicles, compromised on quality, feel cheap and are attempting to leverage the Toyota badge to the hilt.

Well, consumers are not that gullible as they have learned to their cost.

Of the four manufacturers playing or trying to play in the value hatch segment, Maruti Suzuki, Toyota, Chevy and Hyundai at this current moment in time, I would trust Hyundai most, to deliver good quality and keep to a fair price. Maruti Suzuki are too apt to "go cheap" and compromise heavily on quality to achieve a certain price point. Toyota's offerings in this segment are rubbish. Chevy's likewise.

This is only my opinion and indeed, by buying a Hyundai I20 I ve put my money where my mouth is.

I never even seriously considered the Toyota Etios and Liva. I feel that Toyota's range begins with the Corolla in India. I feel also the Chevy's range begins with the Cruze in India, all the lower end offerings are just that - lower end and not for me.

The only other car that came close in my consideration set was the Maruti Dzire and even that, ultimately, was rejected for various reasons.

I think it says a lot about their offering and quality that Toyota did not even enter my consideration set at my budgetary level of 7.5-8 lacs on road for a Petrol powered hatch!
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Old 15th April 2014, 17:15   #47
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Default Re: Shocking! Toyota India admits defeat in the small car segment

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Originally Posted by dark.knight View Post
Initially there were complaints I read by a Bhpian here that the doors completely lacked weather-seals.
Actually that complaint was later found to be false that due to lack of seals on the doors, water enters the cabin. It was some guy who had created a whole blog and disappeared when members here questioned his claims. Infact one of the members even posted a video where he tried his best to drown the car in water and see if there was any leak inside.
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Old 15th April 2014, 17:40   #48
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Default Re: Shocking! Toyota India admits defeat in the small car segment

Its very disappointing that Toyota seems to be throwing in the towel. They do have a sterling reputation for quality automobiles in the rest of the world and if they would have been more successful in India, it would have definitely helped the quality of cars sold here.

Its true that the Liva and Etios have not been able to win the market, perhaps a review of their strategy would have been better.

Surprisingly, they have not been pushing the Etios Cross too much either. Its been a few weeks since I have registered my interest in the Etios Cross, but they have not even bothered to call back. With such an attitude, I guess its best that they admit defeat and focus on the Corolla, Innova and Fortuner segment.
Just hope that they take the right steps for those models, and focus on being the segment leaders, rather than just having a passive attitude.
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Old 15th April 2014, 17:44   #49
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Question Re: Shocking! Toyota India admits defeat in the small car segment

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Originally Posted by GTO View Post
Toyota is the largest manufacturer of cars in the world (well, No. 1 sometimes....No.2 sometimes). No one has a wider portfolio of products spanning hatchbacks, sedans, UVs etc. either. The mass market is Toyota, and Toyota is the mass market. Saying Toyota shouldn't bother with the mass market is akin to Mercedes not caring a damn about luxury.

Several others have. E.g. Honda & the 1st & 2nd-gen City. Maruti also brought in the next-gen Swift & Dzire when the older gens were still best sellers.

I totally agree with Toyota being THE mass market player.
However we clearly need to understand that being a mass market player in North America/Japan and being one in India is a different ball game and Toyota should know it very well. I am not sure if they have ever flourished in a low margin and cut-throat pricing market like ours.


Etios is only for India/Brazil/SA and Indonesia. They are already pushing close to 4000 units a month for each of these in India. If they define success as "No 1 selling in B2 and C1 segment with Liva/Etios" ( outselling Swift, Dzire, i10 and alikes) and getting disappointing with the current sales, I am speechless.

In my view they have not done a bad job and not sure why they admit defeat. Take the curious case of No 2 and No 3 mass market player (GM,VW) in mass market segment (B/C) of India. They are yet to figure out which mass market do they belong to.

They knew very well what they are getting into and this should be no surprise for them. When they say they are admitting defeat, are they discontinuing these?
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Old 15th April 2014, 17:57   #50
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Originally Posted by ku69rd View Post
+1 to that, am still wondering as to why was there a need to develop Etios when they already had the Vios? The pricing might have been around 10-15% more than the existing etios putting them directly in line with Vento/Rapid/City & Verna.
True. Yes competition with Vento/Rapid/City/Verna is a tough one. But I must make some points here:

->People are scared of ASS experiences with Skoda and VW (most BHP-ians will tell their friends/colleagues/relatives to stay away from these brands)
->Maruti doesn't have a capable 'leader' in the segment talked above; SX4 is good, but not great
->City had only a petrol engine all these years(save for 2014)
->Verna is a 'love it' or 'hate it' in this segment; By far the worst in handling
->Toyota has the best brand-pull in India after Maruti Suzuki/Honda

Using these reasons, why didn't Toyota alter the Vios a little bit for Indian conditions?

Having Driven the etios extensively over highways and a little in the city, I can safely say that it is one of the best dynamically. The drivetrain+engine(petrol) combination is the best one I can think of and can match city/vento/rapid.

My advice to toyota:

->Use the same chassis and petrol engine and develop a new car(and don't call it etios). Give customers what they want- good looking, well built, good looking interiors. And don't mess with the main strengths of the etios- boot space, seating for 5. Push it up a segment if required: in the ballpark of city, vento, rapid, verna(refer my above point)

->A little bit of character lines and some contemporary looking design will go a long way

->How much does it cost to use pull type door handles?

->Get the VGT in for the diesel(minimum requirement, and reduce turbolag) or best, change the engine to a good one producing around 95+ horses. I think the Altis need an engine producing 130 horses; Give or take 10 horses.

->The hatch can follow later

Last edited by Samurai : 15th April 2014 at 18:25. Reason: back-to-back post
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Old 15th April 2014, 18:36   #51
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Default Re: Shocking! Toyota India admits defeat in the small car segment

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Originally Posted by GTO View Post
Simply put, Toyota is unbeatable at providing the maximum output of a given input. Or is it?
I think your statement is open to debate in more ways than one.
It is wrong to imply that just because someone has setup a world class optimized production system, it'd also be able to churn out the cheapest costing product for the quality standard the system is optimized for.

In the case of India, Toyota lacked two things : management intent/appetite for investment and relatively speaking, they also faced entry barriers. The barriers couldn't be scaled without investment and for low investments the barriers were too high. A wicked problem!

In this case, I'd rather say its more of a case of horses for courses. For India, they have now chosen to go slow and focus more on profitability rather than volume. This choice, though is open to debate.
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Old 15th April 2014, 18:45   #52
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Default Re: Shocking! Toyota India admits defeat in the small car segment

This was expected. Toyota thrives on mass manufacturing, not low volume which the Etios twins had to contend with. Toyota, somehow, could not price the cars lower which did hit them hard.

But, IMO, the biggest mistake was taking Indians for granted. Simply put, the instrument console they offered was horrible and located at wrong place. Poor interiors, like the one in Brio are still accepted. People expected a lot from Toyota, to offer the best for price.

Lower margins is another concept Toyota found difficult to digest. Toyota, on a global scale, is one of the most cash rich firms. But in India, due to a very poor product under Rs. 10 lakh + lack of volumes might have actually demotivated Toyota. Selling Innova at a high price is an example of Toyota having horrible pricing strategy for India atleast.

What Next ?
1) Bring in Yaris and Vios, price them super sensibly.
2) Get 1.6 petrol in Altis, price against City. 1.8 petrol Altis to fight further ahead.
3) Have a nice diesel hearts across the range, justifying the "Premium" price tag.
4) Get out of "Premium" anathema.

I find that many manufacturers gun for "Premium" word.
More or less, thanks to technology or production techniques, most of the brands are as reliable as Toyota is. No point in having that premium brand selling.

Last edited by aaggoswami : 15th April 2014 at 18:46.
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Old 15th April 2014, 18:55   #53
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Default Re: Shocking! Toyota India admits defeat in the small car segment

We Indians nowadays never want a cheap car. We love cars that are VFM. The interiors matter more to the feel-good factor and could be the only reason to reject a car.

If Toyota gets a VFM car i.e with good interiors,looks,frugal diesel; it will sell like hot cakes even if it price is 10-15% more than competition for that T badge!

A friend of mine needed to replace his i20 (his workhorse car/beater). His first choice on paper was a Etios (large boot,reliablity). But after a test drive, his first reason to decide against it was the poor interiors/features. He has bought a Nissan Sunny.
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Old 15th April 2014, 19:33   #54
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Default Re: Shocking! Toyota India admits defeat in the small car segment

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Originally Posted by swiftdiesel View Post
So is my Suzuki Ertiga at 2.5 years and 50,000 kms later. 100% (literally, not a SINGLE breakdown) reliable and totally fuss free. What I'm trying to highlight is that Toyota alone cannot lay claim to this "reliability" USP in a market like India. All of the Japanese and Korean products are absolutely reliable and it makes no sense attributing this USP to Toyota alone. Those days are long gone.
Sir, what you said is very true and you are spot on. I never wanted to convey Toyota alone is reliable. To be frank 30,000kms on my car odometer do not justify to define reliability. Now a days any car will do a lakh or two kilometers without any fuss. I have been in Mahindra Logan cab with more than 3 lakh kilometers and its doing absolutely fine.The fame Toyota got for there reliability is because of there lowest maintenance cost. Lowest maintenance cost means minimum parts change. Minimum parts change in the long run defines the durability of parts. That's the reason Toyota is a hit among Taxi segment.

I have personally seen an Innova done more than 7 lakh Kilometers on its odometer with the engine being intact and not opened till date. Now i can say that's reliability. I was asking about the service history of the car. The only maintenance done were the regular servicing which includes oil change, air filter, brake pads, and other essentials . Apart from that he has got his clutch changed twice and has got a suspension overhauled once. The car runs on Kolkata roads. If the above statements mentioned by the owner of the car is true i am really impressed by its reliability.

To be very honest i have seen few issues with the turbo/alternator of the 1.3 liter multijet engine, higher service cost of the Hyundai CRDI engines, and a thread running on team Bhp as Maruti servicing is cheap - a Myth. http://www.team-bhp.com/forum/indian...heap-myth.html (Maruti Service is cheap - A myth!) But i couldnt fine much on the D4D engine.
I would personally say maintenance cost of my Etios is lesser than the maintenance cost of my Alto K10. But i will never say that the K10 is less reliable. Its too a very reliable car and running with out any issues.

I guess comparing Toyota with other brands here is going off-topic. But i totally agree on what you told. I will request you if you want to discus further on this please feel free to PM me.

Coming to the interview-

I don't think Toyota will stop the production of the Etios twins. As they are launching the Etios cross. If they plan to stop production they wont invest on the Etios cross. Afaik cross makes no sense to me as its just a mere cosmetic change on the Liva.

Last edited by Samba : 15th April 2014 at 19:40.
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Old 15th April 2014, 20:22   #55
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Default Re: Shocking! Toyota India admits defeat in the small car segment

Defeat from? Their own goals? They probably wanted Etios was the M800 of the sedans and set very lofty goals (upwards of 10-12k per month?). They wanted to be #2 or max #3 and gain "respectable" market share but its been a flop and racing fast to the bottom.

As the world's No 1 (or sometimes No 2), whats considered the right ROI of developing a brand new platform? I dont understand the rationale behind developing a product and selling it only in so few markets. If they could sell in 20 markets instead of 4, it would build a much better case for itself.

IMO, they are lucky they havent made a lot of dents to their "quality" image and folks still love the Corolla/Innova.
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Old 15th April 2014, 20:33   #56
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Default Re: Shocking! Toyota India admits defeat in the small car segment

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Originally Posted by blacksport View Post
And unluckily for them the premium sedan segment just dried up a few years ago. Honda gracefully killed their Civic. And the Toyota does not have a credible C segment sedan.
That was the ideal slot for Etios to fit in. They could have targeted Etios as a competitor to City and the price difference would have easily helped them launch a car that avoided all the exterior and interior cost cutting that they had to do in Etios. It is a good car otherwise and would have got more buyers if Toyota had put in 1-2L more and given a proper car. Remember that City got a diesel avatar just a few months back. A comparable Toyota sedan with diesel option would have heavily damaged City's sales and posed as a tough competitor to Verna.

City sales clearly shows that C segment in India still has potential, but only if customers get their money's worth.

Even now, they can revive with focus on improving Etios and repositioning it in the range of City, probably the same platform with a stronger chassis and better exterior and interior. The corresponding hatch can easily slot in as an i20 and Jazz competitor. And more importantly, provide the diesel engines in a higher state of tune found currently in Corolla - even that is below average for a C-segment sedan.

Quote:
Originally Posted by swiftnfurious View Post
I was talking about the Toyota mechanical parts which help them keep their service costs low and helps the car run for decades. May be with those in perspective, Toyota may NOT be able to price a car to compete with the products under 4L.
It is a tricky situation. Most of the buyers are only looking for 4-5 years of ownership and most other options are equally reliable in that period. Outdated looks ensures that the resale value of the car wouldn't be anything worthwhile half a decade later. So the buyer doesn't really see any need to pay additional amount so that the person who buys the car from him would have a trouble-free experience.

Quote:
Originally Posted by GTO View Post
Several others have. E.g. Honda & the 1st & 2nd-gen City. Maruti also brought in the next-gen Swift & Dzire when the older gens were still best sellers.
Maruti did retain the old generation Dzire as the Tour variant. So I wouldn't exactly call that as phasing out a cash cow with a new model.

However, I don't think Toyota would have gained much by selling Qualis and Innova side by side. They didn't have a real competition at that time except Tata Sumo below and Safari above. Hence they were reasonably certain that a pricier Innova would still attract all the potential Qualis customers.
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Old 15th April 2014, 21:03   #57
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Default Re: Shocking! Toyota India admits defeat in the small car segment

I am happy with the decision, if the reason (for admitting defeat) is that they donít want to compromise on the famed Toyota quality. Maybe the way their sub-10 lakhs cars (Etios & Liva) were received in our market formed the basis for this decision. Those models are indeed a bit of a compromise by Toyota standards.

I think they can do really well in the premium hatchback segment onwards, if they become a bit more aggressive and bring in models like the Yaris ( against the Polo, i20, Jazz etc.) Vios (against Vento, City etc.), and the Rush (to go with the Ecosport and Duster).
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Old 15th April 2014, 21:07   #58
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Default Re: Shocking! Toyota India admits defeat in the small car segment

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Sir, what you said is very true and you are spot on. I never wanted to convey Toyota alone is reliable. To be frank 30,000kms on my car odometer do not justify to define reliability. Now a days any car will do a lakh or two kilometers without any fuss. I have been in Mahindra Logan cab with more than 3 lakh kilometers and its doing absolutely fine.The fame Toyota got for there reliability is because of there lowest maintenance cost. Lowest maintenance cost means minimum parts change. Minimum parts change in the long run defines the durability of parts. That's the reason Toyota is a hit among Taxi segment.

I have personally seen an Innova done more than 7 lakh Kilometers on its odometer with the engine being intact and not opened till date. Now i can say that's reliability. I was asking about the service history of the car. The only maintenance done were the regular servicing which includes oil change, air filter, brake pads, and other essentials . Apart from that he has got his clutch changed twice and has got a suspension overhauled once. The car runs on Kolkata roads. If the above statements mentioned by the owner of the car is true i am really impressed by its reliability.

I would personally say maintenance cost of my Etios is lesser than the maintenance cost of my Alto K10. But i will never say that the K10 is less reliable. Its too a very reliable car and running with out any issues.
I completely agree with you @samba. I too used to drive an Innova and now my trusted steed is an Etios VD. I also own a Swift Vdi. Recently the swift clocked 10,000Km and the service cost was about Rs. 4,400/-. The Etios has already completed about 18,500 Kms. The service cost during the 10,000 Kms service was a mere 2,250/-. The contents of both the services were the usual Engine Oil changes, normal check ups etc. But the service cost of Swift was more due to the price of sundry consumables (like screws, gaskets, drain plugs etc.) When I enquired with the Service Advisor, he had no clue. Further from my experience of Innova, I probed him about the 20K Kms service. He said that some functional parts will be mandatorily changed (whether they are meeting the standards or not). What shocked me the most that they replace the Fuel Filter at the 20K Kms service, irrespective of whether it is clogged or not. I had changed the fuel filter of my Innova at the 70K Kms service. I confirmed with some cab operators and they too were of the opinion that it lasts for about 60K to 70K Kms. So the reliability of such functional parts make the service of the Toyota vehicles a "tad" cheaper. But as you and some members have rightly pointed out, such "reliablility" factors are no longer sufficient to "warm the cockles of the heart" of the Indian customers. Today the vehicle is judged more on its looks (read exterior and interior) rather than its functional reliability. (may be a few "maniacs" like me would still prefer the functional and drivability aspect ) But having said that Toyota cannot ignore the requirement of the masses and bank on the Global marketing strategies to succeed in India. One has to respect the LOCAL market sentiments to succeed. For example, some of the Japan models like the Estima (aka Emina) and Noah, have a center instrument cluster. It seems it is a craze there.They have to revisit on the exterior and interior "looks" to make a mark in India.

Regards,

Samish

P.S. Just confirmed with my friend, who is an owner of i20. He also shelled out about Rs. 4,600/- for the 10K Kms service.
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Old 15th April 2014, 21:27   #59
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Default Re: Shocking! Toyota India admits defeat in the small car segment

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Originally Posted by GTO View Post
That is, surrendering the segment / stopping the fight! That is the part I find shocking...Toyota surrendering on a segment where manufacturing efficiency counts the most.
Do you really think they will give up on the segment? Toyota will say these things now and later spring out of nowhere with yet another attempt. Considering we are a market that does not mind spending 8-10lac on a quality hatch back, I am sure Toyota can compete and they will return.

They got the Etios project wrong but I will say they are the best Toyota's to drive from the India portfolio.
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Old 15th April 2014, 21:52   #60
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Default Re: Shocking! Toyota India admits defeat in the small car segment

I think where the Etios do flopped was they did do anything extraordinary in any aspect be it performance,looks,fun to drive etc.

For a car to succeed i believe it should standout atleast in one aspect. The Innova succeeded because It can ferry 6 -7 people with luggage with superb comfort.Even now there is nothing else that can beat this.
Fortuner succeeded because of its looks/road presence. Price to looks ratio there is nothing that can beat the beast!.

In the current world most of the cars are equally reliable, offer almost same features. Toyota does these just like other manufacturers. "Toyota is indestructible and others are not" is a pure myth!. I have seen my Innova rattle just like others,parts fail just like others, and maintenance cost just like others.
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