hurricanemaxi
Joined: 17 Sep 2011
Posts: 83
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 Posted: Wed Jan 04, 2012 9:58 pm Post subject: Ford Competes With Renault in India With SUVs |
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Ford Motor Co. (F) and Renault SA (RNO) are among automakers unveiling at least 15 sport-utility vehicles and vans in India this week as they count on larger autos to spur demand in a market traditionally dominated by small cars.
“As the customers’ incomes grow, they want to upgrade to a bigger car,” said Joe Hinrichs, Ford’s president for Asia Pacific and Africa, after introducing the EcoSport SUV in New Delhi yesterday. “A lot of people, when they want to upgrade, may upgrade to an SUV that gives you extra space and height.”
Automakers are focusing on faster-growing emerging markets to make up for reduced demand in Europe as the region’s economy slows with the sovereign-debt crisis. Toyota Motor Corp. (7203) and Nissan Motor Co. are also introducing new or revamped SUVs at this week’s New Delhi auto show after India’s record pace of interest-rate increases damped demand for small cars accounting for more than two-thirds of sales in the country.
“People buying SUVs have deeper pockets,” said Deepesh Rathore, managing director for IHS Automotive in New Delhi. “Even if they buy it with a loan, they won’t wait for the interest rates to come down. But a person buying a small car may hold off the purchase until the rates decline.”
Sales of SUVs rose 11 percent during April to November, while car sales fell 3.5 percent, according to the latest data by the Society of Indian Automobile Manufacturers. Total car sales may expand as low as 2 percent in the year ending March 31, after surging 30 percent last year to 1.98 million units, according to the automaker’s group, which said last month it may again lower the forecast.
Sales to Triple
SUV and van sales in India will triple to 1.3 million units a year by 2020 from 434,000 at present, IHS forecasts. About 80 percent car purchases in the country are funded with bank loans, according to IHS.
Hyundai Motor Co. (005380), South Korea’s largest carmaker, will show its concept HND-7 multi purpose vehicle, or MPV, at the show, Arvind Saxena, director for sales and marketing at the Indian unit, said without elaboration. The automaker currently sells the Santa Fe SUV in India, along with seven other cars. Maruti Suzuki India Ltd. (MSIL), the nation’s biggest, will introduce its Ertiga van and a compact SUV, the company said last month.
“When customers move up the value chain, they want to move from a small car to a small SUV,” said Mayank Pareek, the head of sales at New Delhi-based Maruti, a unit of Japan’s Suzuki Motor Corp. (7269) “As the Indian car market grows, we find that customers in urban and semi-urban areas want SUVs to project a sporty and rugged sort of image.”
Maruti expects sales of such vehicles to expand at about 15 percent annually for the next five years, according to Pareek. He declined to disclose the sales target for the Ertiga, a vehicle with three rows of seating. Petrol and diesel variants will go on sale in the second quarter of 2012.
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