Zen, Gypsy and Esteem to get CRDi engines soon

[GTO]

Its time for the Peugeot TUD5 diesel engine to be put to rest, and a potentially delicious 1.3 litre Common Rail Direct Injection engine coming for the Zen, Gypsy and Esteem!

It was reported by Team-BHP ages back about Maruti getting serious on the diesel engines front. The Tata Indica diesel, with sales of 8000 units per month, has almost no competition in the B segments from other like diesel powered automobiles.

General Motors and its subsidiaries will be providing Maruti with the technology transfer.

Heres the Economic Times article
for full details.

GTO

[Dippy]

Thats great news. Its high time Maruti got serious about diesel. What I'm really happy for is the Gypsy. The Gypsy has been one of my favourite Indian off roaders and CRDi should give it everything it wished for CRDI is sure to give the economy of diesel and the performance almost on par with its petrol counterparts.

Cheers

[Revvmaster]

Well GTO

The other part of the news is that the Engine plant is being put up in a JV with Opel and Fiat. Well Fiat and its expertise is understood, but Opel is kinda a big question. Well yes, the Opel Speedster concept with its 1.3 litre engine (sourced from Fiat) would be a part in its defense, but how much Opel is it really?

And to be honest, once the plant is up an running, imagine the problems its gonna create.What if the the 1.3 litre engine ends up in the upcoming Panda as well as the Wagon-R? Talk about cannibilisation. Who is really gonna benefit at the end of the day? Frankly, its ok as a techonolgical partnership, but seriously, Suzuki should look towards developing its own tech, ala Honda for diesel engines. When Fiat and Suzuki would sell cars in the same markets with the same engines and in the same segment, its gonna be other factors such as price, ride and handling, safety etc that would really play in. As far as India is concerned though, i can only see Suzuki benefitting the most. Its another mistake in the long line of mistakes made by Fiat India. The saga continues...

Keep Revvin ™
Revvmaster

[GTO]

Revvmaster,

You have to understand that the size of the Indian market, especially in specialised diesels, is yet very small. As such, we are going to see a lot of engine-sharing and platform-sharing - and rightly so. The investments made in an engine plant are of magnanimous proportions, which grow even further when we are talking of the latest Common Rail technologies.

Its not the first time either. Remember the Peugeot TUD5 that has powered everything from the Indian Peugeot 309GLD to the Zen to the Esteem to the Hyundai Accent. Within the same brand, how many engines do you see powering different cars. Theres the Alto 800cc and 1100 cc, the Tata diesel powering the Sumo/Safari/Sierra etc. The Hyundai CRDi which is going to be common between the Getz and the Accent. Or the Mercedes range which has so much of engine sharing between the C, E, S and M Class models.

Your suggestion of Suzuki designing diesel engines is spot on. But theres only one problem i.e. Suzuki is too small a global player to now start developing diesel engines themselves!! The strongest markets for Suzuki dont care about diesels (U.S. and Japan). And when GM already owns a part of Suzuki, why reinvent the wheel? GM already has proven diesel technologies...whats the point of collaboration without technology transfers?

The only reason that anti-diesel corporations like Maruti and Honda are jumping on the diesel bandwagon is that diesel engines have come of age. They are now refined, more fuel-efficient, less polluting and MORE POWERFUL than ever before. The Merc E270CDi is actually quicker and faster than the E240 V6. The Hyundai Accent CRDi, I believe, is as fast if not faster than the petrol Accent. Consumers the world over are changing their perception of diesel engined cars, with even America waking up to the benefits of the previously unfavored fuel. The torque, and resultant driveability, of diesel engined cars is unmatched by their petrol counterparts.

GTO

[adityapd]

u've hit the nail on the head GTO

~A

[Revvmaster]

Well GTO, u've mentioned a lot of things, most of it being right.

My point regarding diesel engined cars was more about one manufacturer's diesel engined car vs another manufacturer's in the same segment (A, B, C.... ). Now if Fiat and Suzuki do share their engines, its good, it saves cost of development and manufacturing no doubt. And yea, u remember how we'd come to agree the same on the Cayenne story during our discussion on ACI's forum.

My point really is, though developing the engines together is good, its not really sensible. Even though Fiat Suzuki and Opel belong to GM in some way or the other, they work as independent companies and therfore independent profit centres. Which means they need to achieve their targets. Now if Fiat sells the Siena with this diesel engine and Maruti does the same with the Esteem, you have to remember, they are two cars fighting it out in the same market segment. So if the Esteem diesel actually ends up selling 10 cars to 1 of Fiat Siena/Petra, Fiat should really start worrying whether this JV is of real use to them.

The market dynamics of India are far different from those of say Europe, where these kind of JVs really help. Case in point is VW Sharan and Ford Galaxy minivan. Essentially they are the same minivan badged differently and sold in the same markets. It worked yes, but not as well as both manufacturers hoped. Eventually both decided to develop their own line of minivans due to the cannibilisation.

I fear the same could happen to either Maruti or Fiat or Opel out here. Volumes in diesels are increasing, and yes CRDi will power most of the next generation vehicles here, small cars included. Why Tata is developing it too. Your reply that the specialised diesels market being too small (read CRdi, Pump Deuse etc) is from a today's point of view. 2-3 years down the line it will be de rigeur on all cars.

Revv

[GTO]

Hmmmm Revvmaster

I think that Fiat India will be a VERY happy company if they go on to sell 1 Petra for every Esteem!! Jokes apart - Fiat, if anything, will gain consumer confidence by using the same engine that Maruti is using. That way, the customer will be sure of atleast engine spares if Fiat packs up and dumps India. This being one of the main reasons that Fiat, Peugeot and Daewoo didnt taste Indian success.

When I say that the market for specialised diesels is small, its relative to other markets...not what India is going to see 2 - 3 years down the line. I am one who has always insisted that CRDi is the future of diesels in India, but just how many small diesel cars do you see are sold with diesel engines? Yes, the Tata Indica does sell 7000 odd diesel Indicas a month but teh Tata Indica is also two sizes bigger than anything from Suzukis stable. And it sells for 3.5 lacs. Forget a CRDi Zen, even the petrol zen sells for more than that. Do you think that a CRDi MUL product could ever compete with Tata on size and price? Do you think Maruti is looking at 8000 units per month of its diesel Zen/other B segment car? Fat chance...

The real volumes lie in the lower-end and mid-range of the B segment, and everyone knows that they cant compete with the Indica in the now famous "more car per rupee" equation. Thats why Hyundai has not yet launched a diesel version of the Santro and is instead, going for a higher-segment diesel Getz. Even the Fiat Palio cannot compete with the Indica on price and is placed almost a half-segment higher.

Its easy for Hyundai to offer diesel engines with the latest technologies as they HAVE NOT been developed exclusively in India and for India. Its simply a case of taking a developed product from other markets, localising it at minimalistic levels and selling it. Even if Hyundai sells only a 100 diesel CRDi's a year, it will serve as a marketing purpose more than anything else i.e. Hyundai does offer the latest technologies.

But for Maruti, its a different story. It is developing the Engine IN India, manufacturing it IN India and selling it primarily IN India (If you leave the marginal export numbers out). What kind of volumes do you think its going to make? Like I have already mentioned, Suzuki is too small a global player to think of developing CRDi engines themselves. When your business partner already makes them, why reinvent the wheel?

Honestly, I doubt there will be any product canibalisation based on engine alone. Consider the difference between the two companies in commitment to India, size of operations and mass appeal.

Butttttttttttttttt if you read the article again, Maruti is building this diesel engine facility "sourcing technology from Fiat and Opel". There is only "speculation" that Fiat may also source its engines here...but then all this speculation is from analysts and analysts know crap. They cant tell horsepower from manpower!!

Lastly, the only reason Fiat has agreed to this technology transfer is that it IS an independent profit center...and it aint doing Maruti any charity by transferring technologies. I am dead sure there are some really thick cheques going Fiats way.

GTO