[saion666]

Volkswagen selling a decade old design called Polo.
GM launching all Chinese cars,except the Cruze and the Beat none of their cars were competitive.
All Toyota did was make a half hearted attempt with the Etios twins. Why not bring the Aygo, the yaris hatchback or the Auris premium hatchback. No doubt they are reduced to selling just one overpriced hit product,the Crysta.
Nissan has finally launched something worthwhile in Magnite. If a brand is speculated to stay afloat by selling those Datsuns and the decade old Micra, then God help us.

Making such half hearted attempt at the indian market and having a very limited portfolio with stripped down version or previous gen versions of the international variant is not a successful strategy for India. If these brands do not learn to respect the Indian customer ,I am happy they are gone for good.

[RGK]

Originally Posted by Superleggera

Partly to blame the tax structures, but I think the reason is affordability and cost

We must accept the facts that,

Absolutely. You are spot on. The Indian mentality is different and the approach towards cars is very different. GTO had mentioned a few times, owning a car is the next biggest financial outflow after buying a house. It is true that our majority of the population is still below the comfort living zone and owning a car is not a priority.

[MadinMumbai]

Why would anyone in their right mind pay 43% tax (GST+CESS) for a middle-class ride? And then pay another 16-17% (Maharashtra) road tax?

What idiot decides 4 meter or 1.5 lt. is the economic sweet spot and taxes cars basis that rational? What about a car that is 4.2 meter and turns in a better fuel economy?

Also, how economical can it be to build cars for one single market? Hubris of Indian babudom is such that they have decided international automobile companies will build special products (Sub 4 meter, smaller than 1.5lt) to take advantage of Indian tax regime. What we have is a complete dogs breakfast as a result. Inferior products selling for twice the price of developed countries. Then we talk of aatmnirbhar. We can be aatmnirbhar and uncompetitive but don't expect to take on the world with silly restrictive government policies.

Originally Posted by saion666

Making such half hearted attempt at the indian market and having a very limited portfolio with stripped down version or previous gen versions of the international variant is not a successful strategy for India. If these brands do not learn to respect the Indian customer ,I am happy they are gone for good.

One basic fact seems to escape makers of this argument - The Indian market isn't big enough for companies to develop special products for it. We can accept that we will get products developed for the global markets or we can accept products from a depleted stable that 'fit' within our taxation structures. So, yeah we are welcome to Maruti/Tata/M&M, which seem to be the only companies developing products for India. One product from KIA or three from Hyundai might give us a temporary high but don't think they are the basis of a healthy system. We might not be heading for Ambassador/Fiat era all over again, but we're definitely not heading to global quality standards either.

[RoadSurfer]

I would put the blame completely on the companies that are or have already left our shores. When Kia can achieve operating profit with just 3 products and in a year's time and that too in a year like 2020 was, there is no other reason than poor planning and not setting the priorities right. Ours is a tough market to crack but so are other markets world over. There is no single formula to become successful. Bring the right product even if it is costly but you need to ring the right bells in the customer's mind to be able to sell it.

[MadinMumbai]

I wouldn't be too quick to celebrate KIA as a success in India. A single swallow does not a summer make. Only a few years back Honda launched Amaze and it was seen as a masterstroke. One product (50K sales) is hardly a long term success story.

Other than Maruti Hyundai is the only other company that has had a modicum success in the Indian market. Tata's are bleeding money on cars- have been for the last 20 years. M&M makes its money on tractors. When most international companies fail in a market it makes sense to evaluate the market's own failings. Fact is our government is too greedy. In no other country, that wants business growth, will the government earn 4x to 6x of what the manufacturer earns. Our taxation is out of control. And it is making us an uncompetitive and expensive society.

Government has to decide- they can grow the pie, and therefore their share of the pie, or keep taking larger chunks from a pie that's getting smaller all the time. We will never be able to realise our potential with our taxes at current levels. Blaming Ford or WV or Toyota or Harley isn't doing us any good. We are paying more to get less. Our cars are worse than anything being sold in comparable societies. Our roads are worse. Our infrastructure is worse. We pay the same or more for gasoline. We pay more for electricity. We pay more interest on loans. We pay more tolls on roads, which are shit BTW. We are forever going to be a "Go Slow" nation if we don't look inwards and accept our own mistakes. When a GM exits our country it may be a bad business decision. But you know what? Their misfortune gives me no joy. They can exit. We have to stay and keep buying poor quality products.

[Tech_Driver]

It's combination of various factors together:-

1. India is a market for low cost not so great variety models otherwise how can someone justify sales volume of Espresso, Kwid, Alto etc.
2. Lack of local part providers which can bring down cost of vehicle.
3. Herd mentality of Indian population who does not look to other products other than 2 brands however good a product is from different brand at higher price.
4. Lack of clear strategy for Indian market.

[ringoism]

Originally Posted by Neil Roy

I voted Indian customers unique requirements unmet by foreign brands....

Kwid and Triber were designed India specific with safety and NCAP thrown to the winds. They compensated that with funky design, DRLS, Electronic gizmos and viola.... sales started going up. Now we can see kwids on three bolted wheels much like our autos on break neck speeds in the highway.

Points well-taken... though worth noting that three-lug wheels are practically a Renault trademark on their small cars, and I do mean globally, and at least since their 1950's Dauphine, probably earlier... just so nobody thinks it was an Indian juggad way of saving the cost of four studs & lug nuts. Citröens had cars with three-lugs, too... so I'm gonna call it a French thing ...

Seeing U.S. R5's (aka "LeCar") and Encores in my youth, I always thought this trait laughable, but don't tell that to the French... there are conformists and non-conformists in this world and I guess we need some of each. And in truth those three nuts do seem to hold on well enough. Most of the time. The R5 Turbo, btw, was blessed with an extra lug per wheel. They're not totally crazy....

-Eric

[Sandy Damodaran]

I have a slightly different take on this, India's entry to the top 5 of the car markets is similar to Greece's entry to EU. Most of the automotive companies probably expected a linear growth model with increasing penetration over a period of time.

When these assumptions about our countries growth don't look like they can be met, it doesn't make sense for any company, other than those for whom India is a key market would have any incentive to stay. Even for Hyundai I think india is the third biggest market after US and China.

With growth as a whole slowing down (irrespective of Covid), there is no reason for any global car companies to block their capital in a country which for the foreseeable future is going to be stuck on low margin high volume products which don't really align with their global portfolio.

I seriously wonder what makes Honda, VW and Skoda stick to india, even though they are essentially selling 12 year old models with cosmetic upgrades. If Innova/Fortuner gets a good competitor from say Hyundai and it's sales become half of what they currently are, how long before they call it quits? I'd wager they won't bother getting more competitive models to india and block their capital. They are here simply because they (deservedly) created a safety moat and will use it as long as it's profitable to do so.

There is no hope of the Govt giving up on easy revenue, no one is going to fight for lowering the taxes on Cars, Consumers want easy to buy cheap to own vehicles to alleviate the pain of taking a public transport, where is the reason for any company to hold on to the losses and hope for a bigger and better market in the future.

Everyone on this forum may love the Endeavour 3.2, but why would anyone buy that when all they are looking for and can afford for the next 20 years is a Swift?

I think, besides the German Marquees, we are going to have just the Indian Manufacturers + Hyundai soon. And honestly that is sufficient for the demand we have. India might be the fifth biggest in numbers, but remove all Alto and it's competitors, we'd be at around 10th. And no one buying an Alto would even consider any other car, irrespective of the brand.
We can curse the manufacturer for leaving customer in lurch, or giving a sub par car but looking from their perspective, it doesn't make any sense to stay in a game which is loaded against them.

[Mountainman21]

Originally Posted by Superleggera

Partly to blame the tax structures, but I think the reason is affordability and cost
====
This explains the affordability of the cars in other countries.

I don't think affordability has to do much with it; rather constantly changing government policies and complex regulations is what scares most foreign brands.

You would notice countries with lower affordability than India (Pakistan, Indonesia and some South American countries) will see better car launches from same brands which will not launch products in India.

[fazayal]

Originally Posted by Mountainman21

I don't think affordability has to do much with it; rather constantly changing government policies and complex regulations is what scares most foreign brands.

You would notice countries with lower affordability than India (Pakistan, Indonesia and some South American countries) will see better car launches from same brands which will not launch products in India.

India has per capita income of $ 7680 while for Indonesia it's $ 12670.

Indonesians buy million plus cars a year with a population of 25 crores. Indians buy around 3 million cars with a population of 135 crores.

Indonesia clearly has much better affordability than us. Plus petrol costs half of what it costs in India.

The way Indian market is skewed towards Maruti, Indonesian market is skewed towards Toyota. Hence, Toyota launches better cars there.

[Mountainman21]

Originally Posted by fazayal

India has per capita income of $ 7680 while for Indonesia it's $ 12670.

Indonesians buy million plus cars a year with a population of 25 crores. Indians buy around 3 million cars with a population of 135 crores.

Indonesia clearly has much better affordability than us. Plus petrol costs half of what it costs in India.

The way Indian market is skewed towards Maruti, Indonesian market is skewed towards Toyota. Hence, Toyota launches better cars there.

Well petrol pricing is government regulation/ policy which does affect car makers. Also, as you mentioned India buys 3 million (million +) cars which makes India a bigger market for them irrespective of the population.

Also, I gave Indonesia as just one of the example. There are many other countries which get better cars than India even though affordability is lower than India but has easier/ consistent government policies.

I work in consulting and I see first hand how our policies make decision making really difficult for foreign companies to enter Indian market. Makes me really sad when I end up recommending Vietnam/ Indonesia (these days Myanmar) to them instead of India after doing market research.

[Ragavsr]

Originally Posted by fazayal

India has per capita income of $ 7680 while for Indonesia it's $ 12670.

India's real per capita income is close to 2000$ while Indonesia's is 4000$. The numbers you use are purchasing power parity adjusted which is not going to be useful when it comes to cars or fuel.

Thinking loud, imagine the growth we would have if fuel prices were cut to sane levels , 20 rupees below existing prices and gst is capped at 28%. You will have everyone rushing to open factories again.

[Mountainman21]

Originally Posted by Ragavsr

Thinking loud, imagine the growth we would have if fuel prices were cut to sane levels , 20 rupees below existing prices and gst is capped at 28%. You will have everyone rushing to open factories again.

Indeed, even if just above two steps (need is many more) are done by government (with a assurance that these steps are done for a long term) then our market will see a positive response from most Car Brands.

[King_pin09]

While each of the options enlisted here has substantial bearing on the decisions taken by manufacturers to align their products with the market they are in; however I believe it is for the ever changing policies of the Government, be it in terms of subsidies and taxes in relation to the engine size or the dimension or location of the plant, source of input commodities et-al, that force car maker to revisit their strategies much earlier than expected or worse still before even recovering the investments made to implement the previous revision. One day a company makes joyful sales and the next day sees death looming around.