[Aditya]

China's state-owned Changan Automobile Co. Ltd. is rumoured to be considering an entry into the Indian automobile market. The company's executives visited India in November 2014 and were looking to understand the perquisites of entering the Indian market. Most of their queries are believed to have been about the passenger vehicle market.

Changan is China's oldest and fourth largest automobile manufacturer. It has joint ventures with global carmakers such as Ford and Suzuki. It has six manufacturing bases, which are located in Chongqing, Beijing, Jiangsu, Hebei, Zhejiang and Jiangx, and 15 vehicle and engine factories with an annual capacity of two million vehicles and two million engines.

Changan is not the only Chinese manufacturer with its eyes on the Indian market. In 2009, Shanghai Automotive Industries Ltd. (SAIC) has bought a 50% stake in General Motors (India). In 2011, another Chinese manufacturer, Beiqi Fonton Motor Co. Ltd. had announced that it would set up a plant at Chakan, near Pune. The facility was expected to be functional by end-2013. The company had planned to invest $ 400 million and manufacture a full range of commercial vehicles. However, those plans are yet to materialise. Some other Chinese manufacturers are rumoured to have been studying the Indian market as well.

Global manufacturers have started dominating China's domestic automobile market which has pushed Chinese manufacturers into exploring other markets.



Source: Live Mint

[Dry Ice]

Do they have a Wrangler look alike? That way we could get one before Fiat manages to bring the real thing!

Jokes apart, our market will be a tough nut to crack especially if they plan to start with a hatch - home turf of their JV partner Suzuki.

[GTO]

Originally Posted by Dry Ice

Do they have a Wrangler look alike?

In a way, your post hits the nail on the head. Unless 'unknown' Chinese manufacturers have a stupendously strong differentiator / value offering, they can't hope for any kind of traction in our market. It would really have to be something 'different'. And even then, it's going to be challenging for them.

our market will be a tough nut to crack especially if they plan to start with a hatch

So true! Your post reminds me of how the times have changed.

In the nineties, we had GM / Opel, Ford, Honda, Mitsubishi, Daewoo etc. enter the market with midsize sedans. With the exception of Honda, they soon realised there are no volumes to be had with pricey 7 - 9 lakh sedans. What they needed was a mass market hatch. Every analyst worth his salt told the global majors exactly that.

Today, the hatchback segment is so crowded that only a nutjob new manufacturer would enter it. Renault saw a great untapped opportunity in the compact SUV space, got the Duster and is still enjoying its success.

[himanshugoswami]

Given how Indian market has evolved over the last decade, having a good hatch is no longer a guarantee for success. What is a crying need are the following:

1. a good compact crossover in the 7-9lakh price range
2. A "full size" (read Safari/XUV) SUV in the 14-18 Lakh price range.

Get these with decent diesel engines (not necessarily cutting edge stuff but a 1.4 to 1.6 L diesel in category 1 with approx 100 horses and a 2L diesel with 150 odd horses in category 2), and back it up with a good service network, have at least a five year business plan in place and stay the course.

With this, any new manufacturer will have a decent shot at success in the Indian market. A weak brand may not necessarily be an impediment.

Go back a decade to when Skoda entered our market- an unknown brand in India, and that too one which was just shedding is cold war era baggage (being the butt of all automotive jokes). All they did was give a product that was "just right" for the time and the rest is history! (come to think of it, a 2L diesel producing 90 bhp and 210 NM of torque was considered cutting edge then- these numbers are bettered by today's 1.3 l diesels!!)

[Dry Ice]

Originally Posted by himanshugoswami

With this, any new manufacturer will have a decent shot at success in the Indian market. A weak brand may not necessarily be an impediment.

I somewhat agree with you, but then, am instantly reminded of Force One & Premier Rio. Both tanked. Brand does seem to play a part to an extent. In case of FOne & Rio, it may have been due to - 1) already negative brand perception 2) no-so-great products.

[rajeev k]

Originally Posted by Dry Ice

I somewhat agree with you, but then, am instantly reminded of Force One & Premier Rio. Both tanked. Brand does seem to play a part to an extent.

SAIC vehicles failed, even with the Chevrolet brand name.

[himanshugoswami]

Originally Posted by Dry Ice

I somewhat agree with you, but then, am instantly reminded of Force One & Premier Rio. Both tanked. Brand does seem to play a part to an extent. In case of FOne & Rio, it may have been due to - 1) already negative brand perception 2) no-so-great products.

In both those cases manufacturer commitment is missing and their after sales is non existent. Plus the product itself is shoddy.

Whatever I wrote above presupposes that the product on offer will at least be half decent

[AshBabu]

Indian consumers always consider certain parameters as vital for buying a car - Price, Mileage, Reliability, After sale service, VFM etc. Also brand does play a role in the selection.

General perception is that Chinese products are cheap but not reliable. This will be major draw back for the Chinese brands in the car market. They will be starting with a disadvantage and will be uphill task for them to establish themselves in India.

Remember few years back Chinese motorcycles were imported and marketed in India. They were very cheap but it did not sustain people interest.

[amtak]

Times are changing and how. If you look at what is happening in the online arena, people are buying unknow chinese brands, who are selling their mobiles "by invitation" only.

It is to be noted that by doing this, they are first test marketing their product, loading it with all the possible features and before they would release it in the mass market. Perhaps, the Chinese car makers should also do this.

Last but not the least, they should select a sobre brand name and not come with their own brand name. For one, I would not buy a Changan/Guangdong/Ghunzhou or Fonton or anything like that. Give me Qoros, I would buy it without thinking twice.

[petroguzzler]

Originally Posted by GTO

In a way, your post hits the nail on the head. Unless 'unknown' Chinese manufacturers have a stupendously strong differentiator / value offering, they can't hope for any kind of traction in our market. It would really have to be something 'different'. And even then, it's going to be challenging for them.

It would be a really uphill climb for Chinese manufacturers to get a hold of the Indian market. Firstly, the perception of chinese products is not going to do them any favors. And, to atleast have price (value) as a differentiatior, significant economies of scale would be needed which would take a really long time to build.

[Parm]

Premier Auto is trying its luck with its RIO made by Zotye Auto of China, so far it has cracked few nuts, but I hardly saw any nut driving it!

Another example is FORCE One by FM, here also even The Big B failed to get it sold to few nuts.

Chinese vehicles might be cheap and cheerful, but Japanese and Koreans rule Indian auto at the moment.

[arnabchak]

Originally Posted by amtak

Times are changing and how. If you look at what is happening in the online arena, people are buying unknow chinese brands, who are selling their mobiles "by invitation" only.

It is to be noted that by doing this, they are first test marketing their product, loading it with all the possible features and before they would release it in the mass market. Perhaps, the Chinese car makers should also do this.

Last but not the least, they should select a sobre brand name and not come with their own brand name. For one, I would not buy a Changan/Guangdong/Ghunzhou or Fonton or anything like that. Give me Qoros, I would buy it without thinking twice.

Dear Amtak

Selling a Rs. 25K mobile and a Rs. 6 lac+ car cannot be compared.
You have the liberty of changing the Chinese mobile with another within 6 months and even if you shed 50% of your purchase value, you would not care much.

What if the 6 lac Chinese car compromise your family safety in 6 months of ownership?
What if this car just quits on you at every instance?
What about the support and after sales.

No, I agree with most of the other Bhpians that selling a Chinese car with or without pedigree is simply a task next to impossible at the current market scenario(understand that the market sentiment towards the automobile is bearish right now.)

And, this cannot be an invite only event!! Period

[Parm]

Originally Posted by amtak

For one, I would not buy a Changan/Guangdong/Ghunzhou or Fonton or anything like that. Give me Qoros, I would buy it without thinking twice.

Dear Amtak, I was in China with Qoros for some training and they do make some really nice vehicles.

BUT, it is just an expensive Chery! That is what is holding back its sales in China itself. There is also a "talk" about BMW buying into it and pumping some life into the company.

The current owner/chairman of Qoros, who has hired the best of engineers from different OEMs to design the vehicles has his own inputs too along with the engineers. The ignition key near the conventional hand brake did show some signs of inputs from SAAB.

[M35]

"Chinese" toys = Chinese cars. Really?


Look at how the interior of this Changan CS75 SUV is like. I do see many of these on roads here in China which is dominated by Germans otherwise.





Oh yes, it does have a 5 Star safety rating [ C-NCAP, yes China does have one] when tested alongside other 5 Star rated new MINI, Chevrolet TRAX, ,Toyota YARiS, Skoda new Octavia, and Hyundai ix25.


In India, it is just a matter of establishing a decent A.S.S network, I guess.

BTW, do I see Maruti Omni hitting that 6,xxx figure consistently in the monthly sales thread ? Any better than a "Chinese" toy ?

[Parm]

[quote=M35;3624947]"Chinese" toys = Chinese cars. Really?


Look at how the interior of this Changan CS75 SUV is like. I do see many of these on roads here in China which is dominated by Germans otherwise.



Attachment 1329053

QUOTE]

Looks like a copy of Hyundai Santa Fe dashboard.