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-   -   Why are export car models not sold in India? (https://www.team-bhp.com/forum/indian-car-scene/274930-why-export-car-models-not-sold-india.html)

Couldnt find a thread giving any details.

Other than the obvious right hand drive option. Is there any major reason that export models are not sold in India. Curious to know.

Some of the stuff that comes to top of my head.

1. Indian models are watered down to make maximum profit.

2. Tax structure in India makes it better option to manufacture here and sell outside to optimize cost.

3. Sub 4 meter/1.5 L challenges a.k.a having to rework stuff specifically for India to take advantage for such categories.

I am also guessing that the R&D cost to Indianise the vehicle is a tax writeoff making this viable. Since we one of the largest markets.

Is there something I am missing here. I am sure plenty of us would prefer “export” variants for added safety and features if at all sold at a slight premium.

Or have I totally missed it and already both export and local variants are more or less same?


Thoughts?

The primary reason why export models cannot be sold locally is due to homologation regulations - a process that ensures models meet the prescribed regulations and are fit for use in a particular country or region.

Even if a model meets the homologation regulations, our price-sensitive market may not be ready for it. For automotive companies, it is nothing but a gamble to crack new segments in the current market.

Shouldn’t the export model meet/exceed such rules.

If we have a variant specifically tagged as “export” I am sure we will definitely see some buyer.

I hoping beyond hope atleast some manufacturers atleast give it a try. Afterall its minimum investment on top.:coldsweat

Aren't the suspension and drivetrain aggregates stronger in India specific models compared to their export only counterparts?

You covered a lot of reasons in the opening post. Including blatant & cheap cost-cutting for India (OEMs call it "value engineering" rl: rl:).

It takes a lot of effort to launch a model in India = creating a special "product" team, market research, production for local demand, pricing & strategy, press drives, advertising & marketing, dealer training, workshop training, parts support, warranty support etc. etc.

The investment even for a ready model is in the tens of crores. Hence, a manufacturer will only do it if they see demand for it, and if the volumes justify management bandwidth. As an example, Maruti & Hyundai are so used to selling cars in the 1000s of units that they rarely bother with cars that will sell in the triple digits (unless it is expensive like a Tucson or an EV).

Some examples of export models not sold in India:

- 2-door Jimny would have less demand. No matter how many enthusiasts want a 2-door Jimny, even in the USA, the 4-door Wrangler outsells the 2-door in a 80 : 20 ratio.

- A bigger engine or extra length will push the car out of compact car tax benefits.

- Export models will be priced higher. E.g. the export-spec EcoSport had over a 100 improvements than the local car. But it would also cost more. Ford hardly ever made money in the 20+ years it spent in India, so profits were a top priority for them.

Just few days ago, a friend sent a picture of a Maruti 800 in Malta with a rear wash/wipe and I was wondering why couldn't they have included that on the M800 here.


On the other hand, we had Ford launch the Sports edition of the Aspire and Figo which had wheels and suspension bits of the export model Ka+.
But what they could have also sold here was the full length Aspire. (Ka+ sedan)

Good to know! Atleast someone was trying it.

I just wish Maruti and Hyundai also give it a try. Export models as is without any modifications with a slight premium pricing.

Maruti did - The Zen Carbon and Zen Steel were essentially export models of the Zen



Picture courtesy deRivaz & Ives

Though my post is not directly related to export, I was in thailand recently and was fuming seeing the number of cars Toyota have there. I believe both Thailand and India are manufacturing hubs for toyota but in India they are busy rebadging suzuki's cars. Even Nissan and honda have so many models in Thailand which I believe is a relatively smaller market than ours.

Offtopic.

1. Except for few failed attempts, Thailand doesn't have local manufacturers of its own. It tried import substitution in the 1970s, banning imports for a decade, opening up in early 1990s and really opened up in early 2000s. Looks same as India's condition right? But, unlike India they allowed foreign manufacturers to set up factories there. So in that aspect, they had a 20-30 year lead over India, thus having more choices. Also, the Asian market crisis in the late 1990s made them look at exports seriously, ASEAN free trade helping them. That with the strong demand for pickup trucks (low taxes) meant, Thailand has become the world capital for pickup trucks exports and development. (USA pickup truck market is more of a self sustained market without much exports)

2. Toyota has a long history in Thailand starting from the 1960-70s. Toyota Thailand has so many Toyota firsts outside of the Japan market and has been number one(?) in sales for long. That the Hilux has become more of a Thai model than a Japanese model currently should be sign enough that Toyota Thailand is big. Toyota Thailand sells 2-3 times more in Thailand in addition to the export numbers than Toyota India. That said, IMHO, compared to other markets, Toyota has far less number of models offered in Thailand, most of which are being sold as they are already manufactured there.

Our country’s average income is lower. Yes yes, like in all places with great income inequality, there are some billionaires as usual who splurge on exotic cars but the majority of India is poor, no matter how it hurts our pride.

What our market needs is easy: cheap cars that are affordable to most of the population. You sell a billion cars with a 5k profit margin, you still end up making more money than selling 50-100 units of 1-5 crore cars with a 20-50L profit margin.

The problem: you increase 1 lakh in manufacturing costs and after all the taxes and cess and RTO and what not, you might end up with a car that costs about 2-3L extra on road.

For a price sensitive market, this means your car is already dead on arrival if it costs 2-3L more than the competitor in the below 10L segment.

For every 100rs you save by cheapening out on manufacturing costs, you end up with a considerably large difference in the end price the customer pays. This gives you a massive leg up on the competition.

And thus we end up with questionably cost cut cars. It helps that the average person buying a car here has no idea what is normal and what is not.

Any idea how this fared? I am assuming wasn’t much of a success as maruthi hasnt tried it again.

If I recall the timeline correctly, the two door zen was stopped in Europe way before they stopped selling the zen in India. The experiment may well have been a way to simply use up extra bodies they had lying around. That's what I always figured.

Also an often overlooked fact is that incomes in Thailand are higher than India. It doesn't get noticed as much because of our huge population base, but people here don't earn nearly as much as many other countries.

As far as sources of information go, since these were limited editions, they sold a total of 600 units of two-door Maruti Zens — 300 of the Carbon and 300 of the Steel.

So, not a success by any measure - but then again, maybe it is wrong to view it from the lens of a success/failure because it has and will always remain a one-off.

- Cut the car at 3999mm. Why? - Ofcourse Tax!
- Give a 1499 CC, why? Fuel efficiency for life + tax benefits
- GC increased to 195mm or more to tackle Mt Everest peaks and Mariana trenches right in the middle of road.
- Softer suspension so that you don't break your spine going through a moon crater at 60 kmph.
- Why give 6 airbags if the govt doesn't mandate! Even if they do, deadlines are mere warnings.
- Plonk monies on sunroofs instead of 5 star safety ratings. Anyways people don't wear seatbelts in India so 5 star safety is just for checklist on paper.
- Who will buy a RS version? or GRD? or N-line? or M? or AMG? or TypeR? When our basic engine with 4 cylinders runs 20 kmpl.

Such are the needs/demands/requirements/aspirations of an Indianised car and its buyer.
Most of the Indians (except maybe 25% of BHPians, yes, most will want but won't actually buy!) are content what the market is offering and won't dig the extra engines and superior mechanical changes that export models will bring. Do you think majority of the population cares about 5 star safety and EBD, TC, ASC while buying a car in their specific budget? Yes, we care, we are the informed ones and know our machines inside out. But look around, in your own family, in your own circle, and you will find amazing examples of ill-informed people.

I know people in my circle who have bought, thinking Glanza is an "imported" version of Baleno :( and they believe by that. We have someone who owns Compass because they wanted a car as reliable as their old Swift!! We have a Thar guy not because he goes offroad for a hobby, but because vo "systumm" ko hilaana chhata hai. And lastly, my neighbour bought a 60L Honda Accord Hybrid (yes, in India) because we had bought a Honda Civic and he wanted a superior vehicle after test driving on our Civic :D .

Companies give us this step-motherly treatment because they are well aware of the things happening around here and how ill-informed Indian Janta is in the automotive sector.

Happy shopping.
~NA