Re: Ford EcoSport : Official Review Amidst all this hoopla on Ford having pulled off a pricing coup, it appears that a few days have to pass for the dust to settle down and the early adopters to report on their experience encompassing all angles.
Dare I say out loud, that the pricing is not really fantastic pricing per se. By launching the base model at a price of 5.6 lakhs, Ford has managed to get everyone in a frenzy. Lets take a step back....As we all know, its only the Ecoboost and the Diesel variant that get the benefit of reduced excise duties. Ideally, that means smaller cars with qualifying engines end up being cheaper to buy cars.
But passing on the benefits of the lower excise duty on the Diesel version to the customers would mean that Ford is compromising on the margins of the variant that it expected to drive a vast majority of the business by volume i.e., the Diesel.
So how does Ford convey the impression that they have indeed pulled all stops when it comes to pricing and yet ensure that they laugh their way to the bank? By pricing the non-volume seller low and ensuring that margins on the fast movers are protected.
Since the EcoBoost engine is imported, there isn't much scope for pricing it cheap and moreover, when it the "Engine of the Year" for 2 years, you don't want to price it in such a way that it loses that aspirational value or becomes mainstream. After all, you don't price cutting edge tech at the lower end when 'cutting edge' itself connotes or co-relates to 'premium'. So the EcoBoost cannot be the sacrificial lamb for dropping the pin on lowest pricing or the 'starting value' of the range.
So what are we left with? Only the 1.5 Petrol. But, but..the 1.5 petrol in any event does not have a price advantage because it gets no excise reduction (calculated for the 1.5 petrol vehicle taken as a whole and which is no different from the diesel EcoSport except for the engine). So what? Let's take a hit on the 1.5 petrol and price it really low for a variant that hardly anyone would go for (except maybe someone who is really smitten by the vehicle and doesn't care for other features) to reduce the risk of losing too much money. This serves the singular purpose of proudly stating that the "EcoSport Range BEGINS from Rs. 5.6 lakhs". True, it does. But who will buy it? If you see the comparison chart and the features they have adorned it with, it is clear that no person is likely to have an innate desire to settle for the Ambiente. In fact, the distribution of features is almost as if Ford itself doesn't want you going for the Ambiente considering that they start providing decent equipment levels only from the Trend variant onwards. In fact, all the right nudges for a customer to sub-consciously veer towards the Titanium variant are all present. Ford may be thinking, "Even if a small minority buys the base 1.5 petrol Ambiente for the price alone...never mind, we will absorb the loss and make up our margins in the Diesel segment by retaining the benefits we've got from lower excise."
So, one goes to the showroom salivating at the fact that the cool new Ecosport costs really less, and ends up spending anywhere between 8-10 lakhs......smack in the middle of where Ford wants them to be.
Just for a second, imagine if the Ambiente variant was not a part of the list. The cheapest Ecosport would have started at 6.5 lakhs ex-showroom, a whole lakh more for no ground breaking feature or creature comfort. The existence of the Ambiente variant is only to associate the 'value for money' concept/idea with the Ecosport.
Once that is done, the footfalls will happen naturally.
I don't deny that Ford has priced it well. All am saying is that it has not been priced that well either. Yes, it undercuts the Duster, but isn't that saying a lot about how Duster itself is overpriced for what it offers? Also remember, the Duster is its closest rival. That is not to say that it is a closely matched rival on the basis of function or purpose. The Duster has not been built or intended as a sub-4m pseudo SUV.
And I hope that this is not introductory pricing only to be hiked later. That would be disastrous. |