22 July, 2015, Business Standard
Tata Motors, India’s biggest commercial vehicle manufacturer, is preparing for over 100 launches in the commercial vehicle space this year including new products in white spaces that will address specific consumer requirements.
Though the recovery in the commercial vehicle space that kicked off in October last year is termed as in a ‘not a true’ recovery state, companies like Tata Motors is aggressively pushing products in the market to push its market share higher.
Ravindra Pisharody, executive director (commercial vehicles), Tata Motors said, “We are going to launch more than 100 products this year and it is going to be like this (from here on). If we look at our portfolio from the Ace Zip it goes on till 49 tonne (truck) and buses. A lot of variants will come from Ultra and Prima products. We have already launched about 20 products in the first quarter itself”.
Last year the Mumbai-based company had launched between 80-90 products, when the CV market had shown a dip of 3% to close at 614,961 units, as per data provided by the Society of Indian Automobile Manufacturers.
“We launched the Ultra 8 tonne six months ago but the big segment is the 10 tonne so we just launched it. We have launches in Prima and Ultra in terms of new cabin and new powertrain. Prima LX is coming in 25 tonne and 31 tonne in multi-axel trucks. So we will have more variants coming out in trippers and tractor trailers”, added Pisharody.
While sales of medium and heavy commercial vehicles (MHCV) posted a growth of 16% last year light commercial vehicle (LCV) sales marked a drop 12% during the same year, according to SIAM data. While the first quarter of this year showed an increase of 23% in MHCV sales LCV sales were still down by 7%.
But Tata Motors is confident of a recovery in LCV demand in the second half of this year. For this the company is preparing the launch of yet another model under its successful Ace brand.
The national roll out of the Ace Mega, which is positioned between the Ace and the Super Ace will be done in the next few weeks. The new model is already launched in the northern markets of the country.
Though Pisharody declined to provide details about the launch the 1.4 litre common rail engine Ace Mega will likely have a payload capacity of around 900-950kgs and a pricing of around Rs 4.4-4.8 lakh. The regular Ace (payload 840kgs) is priced at Rs 3.84 while the Super Ace (payload 1000kgs) is priced at Rs 5.09 lakh.
“Ace almost killed the cargo three-wheeler segment. We introduced the Ace zip below the Ace. Between the Ace and the Pickup the Super Ace came in. With so much competition people are trying to find niches here and there. In this situation one cannot slowdown product development. More variants are coming of Ultra, Prima and Ace”, added Pisharody.
Demand for new trucks is fuelled by the fleet owner’s need to replace their existing assets. This replacement demand will last only until there are older vehicles to be phased out. Typically trucks owners liquidate their assets after five years but during the slowdown years of 2011-13 truck owners postponed the purchase of new trucks and sweat their assets longer.
“We are not deferring any product development (process), we did so in 2008-09 but it cost us because the market came back very strongly. Of the Rs 3,000 crore capital expenditure targeted by the company about 50% would be CV products only”, added Pisharody.
With this capacity utilisation in MHCV for Tata Motors has shot up to 65-70% which had come down to 35-40% in recent years.