Avalanche of cars on its way

50 launches in next 12 months.

The launch of the new Tata Indica today flags off a frenzied rush among car companies, revved up by the success of recent launches, that will see as many as 50 new cars hitting the Indian market in the next one year.

These will cut across segments and price points and join the over 200 cars that are already in the market.

"According to our assessment, there will be 50 new cars in the next 12 months or so. In recent times, new models have done very well and people have come to believe that these are the most effective way to grab eyeballs," said Dilip Chenoy, head of the Society of Indian Automobile Manufacturers.

Among the recent launches, Maruti Udyog's Swift, Ford's Fiesta and General Motors' Chevrolet Aveo have quickly raced to the top of the best-sellers list.

Not surprisingly, the investment banking community has become more bullish than ever on the sector and puts forth a list of new launches to explain its enhanced interest.

This includes premium compact Chevrolet Aveo UVA and compact Spark by General Motors; Grande Punto by Tata Motors; Getz diesel and a new compact by Hyundai; Swift diesel and the new Zen by Maruti Udyog; a new car by Volkswagen, Europe's largest car company, which is entering India; Fabia by Skoda; Logan by Mahindra-Renault; and either Jazz or Fit by Honda.

There will also be a clutch of offerings from DaimlerChrysler, which is likely to unveil a bunch of new cars any time, and its arch-rival BMW, which is going to build the 3 and 5 Series in India from next year.

Car companies are spurred on to launch new models because of the falling costs of launching a car as more and more vehicles roll out of common platforms.

For instance, the new Zen, to be launched next month, is derived from the Suzuki MR Wagon and will be fitted with an engine from the Wagon R line. It shares platform bits with the Alto and the Wagon R.

The falling cost of new cars is reflected in Tata Motors' ability to price the new Indica as a rival to the smaller Alto, Maruti's largest selling model.

On the flip side, the flurry of new launches is reducing the life of individual models. Industry experts estimate the current life of a model at 2.5 years, half of what it was pegged at as recently as two years ago.