Sunday, 31 October 2010

Peugeot Citroen- How the french Make and sell cars.

The French and automobiles share a relationship as old as automobiles and humans. Renault, Peugeot-Citroen, Buggati and Venturi are some of the well known French brands that have greatly helped in the way the industry stands today.

While Renault is the largest Automobile manufacturer in French also having a major Stake in Nissan, Peugeot grew within the country taking a majority stake in Citroen first in 1974. Today cementing it's place as the sixth largest car manufacturer in the world, Peugeot-Citroen has yet to capture various major markets including North America, India and Australia.  No wonder though how Peugeot Citroen has not amalgamated into a single automobile manufacturer working on the same lines as Renaul-Nissan. (Peugeot Citroen partnership is older than Renault-Nissan.)





Peugeot has been making cars since 1882 as per recorded history after the founders meet with Gottlieb Daimler. But their skills with wheels date way back to 1830 when they began making bicycles. When in 1974 Citroen was in trouble Peugeot starting buying stake in the company with support from the government.  The most notable way of recognizing a French car is definitely looking at their design and then the logo.



Citroen on the other hand was the first mass manufacturing car company after Ford. In no way is it erronous to say that Citroen has been the most radical car manufacturer in automobile history. The company really took their French roots pretty seriously and with government support their marketing campaigns put them on the world market as the fourth largest car makers.

Before Peugeot, Citroen's overtly ambitious plans had also put then in Jeopardy before when Michelin had to step in and save the company.  Surprisingly Peugeot-Citroen is the only company which has successfully run two brands in the market competing for the same customers. Peugeot's gamble of diluting Citroen's brand image has worked. The only other company to be able to do it successfully has been Toyota with its Scion brand and Vaulkswagen with its Seat and Skoda brands. Surprisingly Peugeot-Citroen is the sixth largest car maker even with the absense in major markets like U.S. and India. Peugeot did recently enter those markets but with bad results.


Alongwith Citroen's creative dynamics in car manufacture, Peugeot also inherited their marketing genius which is clearly visible in the following advertisements.





It is clearly visible that while Peugeot is the more mature tried and tested brand, Citroen comes out as the young and innovative brand which can stand out amongst the crowd similar to Scion cars. No wonder then if you find both the brands vying for a space in racing which no other car company has done succesfully. No surprise either if you find resemblance between the cars from two brands since they are based on the same model.






Sunday, 24 October 2010

Technology sharing.

With the world economy coming down crashing, various car makers have made alliances to cut costs and increase profitability. It should be no surprise then if you find the same spares going into different cars. Looking at the brighter side you can get the same spare for cheap if you go around shopping since various car brands tend to charge a premium. For the many others it is an opportunity to tune the engine to suit personal requirements.


1. Chevrolet Spark/ Beat: Based on the Daewoo Matiz, the Spark was the volume car for GM. Internally called M200/M250, Chevrolet Beat is the new spark aka M300. While both generations of the car are available in many markets, spark is sold as the cheaper alternative badge.  The 1000cc S-tec engine has also been carried over to the Beat but upgrade to meet the emission norms and tuned to be more efficient in terms of power and fuel efficiency. The 800cc engine has been carried over from Daewoo which was again based on the 800cc engine we are familiar with on the maruti Suzuki 800 and Maruti Suzuki Alto.


2. Hyundai Sonata/ Chevrolet Cruze/Chevrolet Optra/ Chevrolet Captiva : Are you amazed by how powerful and fun to drive the Chevrolet Cruze is? Well, there is a reason why this engine performs unlike other GM engines. The Diesel engine which also does duty on Chevrolet Optra and Hyundai Sonata has been sourced from VM Motori. It has been internally named RA 420 SOHC.





3. Fiat Palio/ Fiat Punto/ Fiat 500/ Marusi Swift-Dzire/Maruti Ritz/ Indica Vista: When Fiat decided to fund its expansion plans for India, they looked at their excellent engines department. The 1300 multijet diesel is what has helped Fiat make a comback. The same engine is found in  all the cars mentioned above with various states of tune.

PS: Tata has also incorporated the Indica Vista with Fiat's gearbox.
      Indica Vista and Fiat Punto also share the petrol engine.



4. Fiat Linea/ Tata Indigo Manza/ Maruti new Swift: The same diesel engine mentioned above was also launched in a more powerful state of tune (93bhp) and is doing duty on two cars right now. The new maruti Suzuki Swift due to be out soon us also rumoured to get the same engine. The only difference between the the engine mentioned above the this one is the variable geometry charger.



5.  Ford Figo/ Ford Ikon/ Ford Fiesta: The 1.4 Diesel engine from Ford India did such wonders for the company back in the day that the whole nation took notice of this car brand and sales took off. For a long time Ford fiesta was the only competitor to The new Honda city as far as sales were concerned with the Accent, Verna, Aveo, Lancer and others eating dust. The Duratorq engine still has some fight left in it and has recently debuted in the Ford Figo.


6.  Hyundai Santro/ Hyundai I10: Just like the Chevy Beat and Spark Hyundai Santro and Hyundai I10 also use the same engine. Supposed to be a successor to the best selling santro, Hyundai decided to retain both the cars to take on Maruti's arsenal of small cars. The gamble has surely paid off.


7. Hyundai I10/ Hyundai I20: Hyundai loves to cross-breed cars. The i10 which shares one of its engines with the Santro shares another engine with the i20. Same tune and same components which lets Hyundai earn a fat maring on each car sold. No wonder they sold i20 in records units last month.



8. Mahindra Scorpio/ Mahindra Bolero/ Mahindra Xylo: Mahindra hit an ace when it put the CRDE engines under its MUV, the Scorpio. Sensing the potential of the engine, they retuned it and the now the engine can be found in the Bolero, XYLO and the Scorpio.

PS: Mahindra has named the engines Mhawk and MEagle based on the states of tune.


9. Maruti Alto/ Maruti A-Star/ Maruti  Zen Estilo/ Maruti Wagon R: Maruti is the mass car manufacturer of India. Sometimes synonymous to a 'car' Maruti Suzuki has come a long way from the Omni and Esteem.  The KB series of efficient engines have proved to be an asset for Maruti sending the company's sales skyrocketing.


10. Maruti Ritz/ Maruti Swift/ Maruti Eeco/  : Reducing the number of indigenous parts also shows here. Based on the same engine serious mentioned about but bored to 1200 cc, this engine does duty on the various cars under the Maruti Suzuki umbrella.


11. Skoda Fabia/ VW Polo:  The New Skoda Fabia has just been launched. No wonder since VW's Chakan plant has been churning out three beautiful engines to use. The 1.2 Petrol, 1.6 petrol and the 1.2 Diesel are doing duty on both the Polo and Fabia.


Cars like the Octavia/Laura and Jetta and Superb and Passat have also begun engine and technology sharing but being based on the CBU route, many of the components change from time to time. For e.g. the Laura which is the Current generation Octavia worldwide has seen various engine upgrades in the Indian market.
Also ICML (Sonalika group) has entered into a pact with GM to supply their engines from the Rhino UV's for Chevrolet Tavera to be sold in BS-IV zones.

Sunday, 17 October 2010

Ten tips to be the smarter driver.


1. Driving is a previledge and not a right. India is a big country and it is tough to manage so many people on the road. be responsible.

2. It is tough driving at night. What makes it more difficult is idiot drivers who drive with their headlights in upper mode. Some go further and also switch on their fog lamps. You are not illuminating the road but glaring the light in the eyes of oncoming traffic. It is easy to make sure that the dash doesnt have the upper mode light on.


3. When driving on the road, you are supposed to drive in the middle of the lane and not the road. By driving in the middle of the road you are not only disrupting the traffic but increasing the chances that the driver behind you is irritated and might make a risky move.

4. A road is not a race track and a race track is not a road. Drive responsibly at moderate speeds. Even if the roads are empty we never know from which unseen road will the next vehicle come.

5. Do not talk on the phone. It is equivalent to a joker doing tricks at the circus. Nobody is that busy to stop their vehicle for 2 minutes than jeopardize the life of other around you.

6. A horn is not a sound system. Only use it when needed. unnecessary honking only adds to sound pollution.

7 .When you swear looking at someone coming the wrong side, Others do the same looking at you. Always drive in appropriate lane.

8. Don't cut through tight space. If you do, make sure your vehicle doesnt scratch or dent others vehicles. It's not just a cut, everyone is possesive about their vehicles.

9. If your vehicle is damaged in a crash. Do not be angry. Have the guts to accept the damage before buying a vehicle. It will save you a lot of time and energy.

10. A helmet and Safety belt are not for the traffic police but for your safety. Use them.
PS: It is ok to joke about that corrupt traffic police hawaldar with belly thrice the size of his head. Laugh at him on his face if need be.

Sunday, 10 October 2010

The lost case of FIAT India- again

Mr. Rajeev Kapoor is a busy man. He might reluctantly agree to being worried too. The Current CEO of Fiat India is seeing the landslide..... again. Fiat has found it hard to find a footing in India just like Alexander. The biggest automobile conglomerate from Italy has had the longest history in India (1954) but definitely not the most successful. Why has the company not tasted continuous success?

Even today Fiat India holds a miniscule market share of less than 1% with 1625 cars sold last month. Nissan which launched the Micra Last month is already on the heels and even Mahindra's Logan is doing similar numbers by itself. Why then has a company that always dances to the tunes of success at each car launch fades away into oblivion quickly? Case in point being the PAL 1100 in 1954 to Fiat Palio in 1999 to Punto/Linea in 2009.

The 500
Fiat got its first entry through the PAL venture in 1951 via the 500. Surprisingly, at the moment Fiat 500 is also the newest model in the Fiat lineup. Sad then, that none have been sold in the last few months. Even sad since the Fiat 500 is a cheaper premium car at 14 lacs than the Volkswagen Beetle at 21 lacs and even sad then that the car design, interiors, features, engine and whatever remains jointly make up for an awesome car. What???? You never knew fiat 500 is for sale? Mr Rajeev Kapoor, are you listening?

For a car that is supposed to be a brand building exercise for Fiat India the awareness is just not there. For comparison Volkswagen flew 38 Beetles off its showroom floor.

A brand building exercise starts with promotion of the brand and the model. Mr. Rajeev Kapoor knows better that just doing a launch at Auto Expo and running the car around at some Fuel Efficiency drive doesnt get the car visibility. TV commercials, Youtube blitz, occupying showroom display floors and magazine reviews is what makes people sit up and take notice. It doesnt hurt to advertise how it shares the same engine as the Maruti Swift of Tata Indica Vista. So, will I see some units of Fiat 500 sold next month?

PS: I definitely don't know if that red interior should get a thumbs up or a thumbs down. It definitely is noticeable though.


Fiat Linea
European brands are always known for their luxury, technology and understated elegance. Not to mention that Style comes naturally especially if you are European.

No wonder the Fiat Linea made all the right noise at launch. Priced much below its actual rivals and engineered to detail, Fiat Linea increased the sales for Fiat India by four folds. The Small capacity petrol and the Infamous diesel engine were an icing on the cake along with class leading features. But Fiat is known to spoil its own party. While they provided better after sales service, the interior plastics were pathetic enough to shame a maruti 800. Yes, The circulation vent plastics were that bad. The glass window liners in some cars I personally saw were deep and uneven. And slowly and gradually tata dealers started pushing the slow moving Linea to the back while promoting the easy to sell Indigo Manza.

Whatever makes one feel that a 1000000 INR Linea and 100000 Nano can be sold on the same showroom floor needs a reality check. I would suggest that Fiat India atleast gets one dedicated Fiat only showroom in most major metros. The people mover image of Tata is certainly rubbing over Fiat. A dedicated luxury showroom in every major metro will help solve this issue.

Additionally selling at a lower price point is just bringing losses to the company? Why sell a car at Rs. 8.00 lacs when other competitors are selling their offerings at 11.00 lacs? A 3.00 lacs prices difference cannot be justified for lack of a powerful engine. But, It does justify your poor plastics. Sell first, service will follow and so will word of mouth marketing.


Here are some numbers to show where Fiat Linea stands compared to rivals.

Mitsubishi Lancer +Cedia 58
Chevrolet Optra 236
Volkswagen Jetta 254
Honda Civic 574
Fiat Linea 724
Toyota Corolla 1082
Volkswagen Vento 1364
Hyundai Verna 1818
Maruti Sx4 1965
Honda City 6164

Considering Mitsubishi Lancer+Cedia are outdated and HM is an even pitiable situation to Fiat India and that Chevrolet Optra is at the end of its line, only the more expensive Jetta and ergonomic mistake the Honda Civic are behind the Linea. But if I am an analyst at Fiat India I will not the numbers put in by the uber succesful Honda city, the Maruti (does one really care what model it is?) SX4 and Hyundai Verna.

I definitely hope that the Fiat India chiefs put their other gremlins aside and make sure that the Linea t-jet launch at hand get Fiat Linea number again in the 1500 cars a month territory on a constant basis. Here is an ad showing how Italians are as good with advertisements as with their designs.





Fiat Punto
Sales zoomed from 200 units a month from the Palio to about 2500 units every month with the help of the new car that Fiat recently launched. The Tata Fiat Service announcement and stress on After sales were a big boost. Fiat made all the right noise and people took notice. The petrol and diesel variants covered all the price points against the competition. Until a few months ago, Fiat stopped advertising and promotions of their new cars. Stock market received the news that all is not well between Fiat and tata. Sales for the Punto hover around 900 units while competitions sells over 5000 units on an average.

The problem? There are quite a few here. For a car that competes with Maruti Swift that sells 11000 units a month, something is definitely wrong. To begin with Tata dealers try to push the Indica Vista to the buyers. Secondly, It's not the salesman's fault since the Indica Vista does make the Punto look a bad bargain. Obvisouly since not many are going to check how reassuring the thud is or how precise the steering is. These are some of the features that need to be communicated through various ads. I really like how Volkswagen Polo commercials stress on their handling, safety and durability. No doubts then that Polo sells more than its cousins Skoda Fabia.

Thirdly, The interior plastics as mentioned before rob the car of its upmarket image. One should not consider this fact with Honda city, since it is a car that has defied most logics. Time to improve on those. And why sell your cars at a discount?  Fourthly, the Fiat palio Multijet was never advertised. How is the car buying public supposed to know that such a car exists? The launch of Toyota Etios are definitely not going to help things. For a car which is supposed to be the bread and butter for the company, the state of things are definitely pitiable.

PS:  Launch the Fiat sport advertised at the Auto Expo with the new t-jet 1.4 albeit in a limited 100-200 units complete with the racing stripe. Also, I supposedly know that Fiat makes a  quick buck from each maruti Swift and Maruti ritz diesel sold in India. (Hint, Hint) Put that in the advertisements.


Units sold last month

Skoda Fabia 256
Chevrolet U-VA 283
Honda Jazz 649
Fiat Punto 902
Nissan Micra 1183
Volkswagen Polo 2891
Tata Indica Vista 6258
Maruti Ritz 6408
Ford Figo 6465
Hyundai I20 7680
Maruti Swift 11913

Tata dealers
Tata is a great car brand and respectedly holds the tag for being India's second largest car maker. Those who buy tata car belong to the group of anti-liberalists for whom anything outside Maruti and Tata is not a car. The salesman standing in the Tata showroom doesnt know that an anti-roll bar is and whether the same engine goes in the Punto as the Indica Vista. Those who buy a Honda City or a Vw Jetta definitely do not enter the Tata showroom since the two crowds are different. That is the first speedbump. For those who might want to give a try to a luxurious fiat car still finds it tough since the Showroom people dont want to put that extra effort (Similar commission levels?) in selling a Fiat which has a tarnished history and reputation in India. That is the second speedbump. When it comes to after sales, Maruti rules with a sheer number of service centers around the country with quality be damned followed by other car makers such as Hyundai and Honda. Tata definitely doesnt feature on the right side of the list of good service providers. This definitely does not go down well for Fiat. This is the third speedbump which is enough to loosen most screw on Fiat India's success ride.


While Tata-fiat joint dealership is an excellent way to reach a wider audience, Fiat needs dedicated Showrooms in metros too. These dedicated showrooms should be willing to burn mid night oil in building the brand for Fiat against Honda, Mitsubishi, VW and Skoda. Their workshops providing excellent technical guidance and after sales service which makes customer smile. These dedicated dealerships will help give justice to Fiat India's efforts such as Fiat first

PS: My Honda Jazz gets picked up by the Honda dealer, service and delivered to my doorstep. Lesson learnt?


New models and promotional blitz
Fiat Italy has been on the verge of posting huge losses and came out strongly. Mr. Sergio has recently also acquired controlling stake in Chrysler USA. Alfa Romeo sale and losing market share in Europe are but small problems for the ferrari and maserati owner. The shareholders have also finally given green signal into breaking the company down in a car making division and a component and trucks division. But Fiat has not moved an inch in India since its inception playing the hit... hit... missed game all along.

Fiat should concentrate their marketing muscle on television and newspaper media where the subject is comparing the linea and Punto to their competitive offerings. The car buying public needs to know they have an option which is really that much better and atleast worth a look. An occassional ad about Fiat 500 will also help build the brand image for the company.

Ranjangaon plant is definitely buzzing right now and Fiat is making the DDIS engine that is powering more cars than Fiat has on their lineup. This definitely calls for more cars to be offered for sale based on the same platform. A rebadged Opel Corsa can be introduced to play the two model card that Maruti is successfully playing with Ritz and Swift. This will help Fiat introduce more models to cover a wider product range and offer a car for each segment at every price. This move will also help in cost efficiency since both the Corsa and Grande Punto alongwith Linea are based on the same GM Gamma platform.


PS: Dont make the same mistake of not upgrading the engine, design and interiors like with the Fiat Palio Stile. Your experience proved it was a disaster. Nice ad though.

Sunday, 3 October 2010

Premium luxury cars. Time to sell that E-class.

With the increase in the car buying population car makers have found it increasingly easy to position their car for a specific target segment and remain profitable. So for a  majority of the world population, a car is a car is a means of commuting to work and home and an occassional outing. Out of the remaining a sizeable populace segments cars as the mainstream affordable cars and then the luxury cars.  And then a few take things seriously. They either work at a car company or a related industry or are car enthisiasts like me. We segment cars in so many we ways, we lose count.


But let's say you own a Bmw 5 series or a volvo S80 or an Audi A6. The stock market just gifted you some more of that green stuff. You dont know what to do with your money. It's not enough to buy an island or an airplane or even a lamborghini or Maybach yet. And your offspring is already eyeing your car to go on a date with that green eyed cutie and burn your not so hard earned money. Here's the solution. Welcome to the niche luxury car market where you take the next step towards opulence and status and announce to the world 'I've arrived... yet again.'.  Ahem! so here goes some cars you might want to look into.

Jaguar:  Beginning with British Motors Corporation, Leyland, Ford and finally TATA, Jaguar cars has had a somewhat chequered History. The company makes three models namely the XK coupe, XF Sport sedan and the XJ limo. The British car has got enough bells and whistles to take the game heads on into the German and Swedish territory. Tata is planning to launch cheaper versions to increase sales and that is not a good thing in terms of brand equity but good for sales and profitability.



Porsche: The name Ferdinand Porsche shines in Automobile history books with the likes of Maserati Brothers, Enzo Ferrari and Ferrucio Lamborghini. Very few cars hold on to the luxury marque and still do corners like the Porsche. Those which do dont really sell as much. So that's Porsche for you all the way from Stuggart, Germany. With a recent foray into four door sedan market with Panamera, and foray into SUV's segment with the Chayenne, Porsche still holds the record for making the best fun to drive cars. Pick of the lot is definitely the 911.



Cadillac:  When upgrading to the premium car class, car buyers want them to look unique. A Porsche for eg not only looks distinct but makes you look up with its sound as well. Cadillac does the same thing in an American way that mixes Hip-Hop with Ball dancing and makes it look elegant too. It's completely German when looking at the size, engines and those sharp angular looks. One might mistake a Chris Bangle BMW(more so with Bangle leaving BMW) for some other car but a Caddy cannot go unrecognized. The brand did lose its focus and style in the early 90's but the latest car as equally opulent and reliable as any other car from any other competing brand.


Aston Martin: You are so british, your under clothes resemble the Union Jack. You have grown up watching James Bond as the ultimate spy hero who can take on Superman and Batman with his wits and weapons. Your previous car is from a British Brand that doesnt exist anymore but will still fetch a million pounds at an auction. The Aston Martin is for you. A legend associated with Aston Martin's goes that James Bond is for real and that all Aston Martin's have secret gadgetry in them. Another also goes on to say that Aston Martin owners are 00X spies in reality and that M is for Martin. Aston Martin is also one of those brand which diluted their history with a sedan ala Lamborghini and Porsche.



Maserati: Credited as one of the earliest Sports car makers, Maserati has proudly carried their emblem over the years. Nothing in the automobile comes to being as close to the word sporty as this company created by the Maserati brothers. Long before the Evos, Panameras, Estoques and Rapides the Quttraporte has held its own since 1960's. The current gen cars have engines from Ferrari which are domesticated to suit grand tourers and designs are from Italian design powerhouse Pininfarina.



Spyker:  The name Spyker has been around since even before Ford and around the same time as the Benz. But the company that makes cars today is relatively new starting business in 1999. This is not necessarily a bad thing based on their experience in building Aeroplane engines. Not surprisingly they bought another car make SAAB which again is a Scandinavian company with Aeronautical roots. With a D8 and C8 and C12 in their line up, Spyker is atacking right at Porsche where it can hurt the most. They need to correct their prices a bit. But for sheer flamboyance nothing comes close.