Tata's Ace trumps competition

Tata Motors likely to up production of Ace by 100% to 60,000 trucks a year.

In just five months, Tata Motors's new mini truck, Ace, has changed the dynamics of the light commercial vehicle market and prompted the company to plan a 100 per cent increase in its capacity to 60,000 trucks a year.

A Tata Motors spokesperson confirmed that the production of Ace was running to full capacity "on an annualised basis" and expansion was on the anvil.

Ace, which opened a new segment within the LCV market, was launched towards the end of May this year.

Since then, Tata Motors' LCV sales have grown 36.5 per cent to 28,537. In contrast, Mahindra & Mahindra, the second largest LCV maker in the country, reported a fall in sales by almost 7 per cent during this period, with total volumes at 14,630. Expectedly, the market shares of various players have changed.

Tata Motor's share has crossed the halfway mark to touch 56 per cent during April-August, against 47.6 per cent in the same period of last year.

On the other hand, M&M's share has fallen to 28.8 per cent from 35.8 per cent. The two players account for nearly 85 per cent of the total LCV sales in India.

The second largest commercial vehicle producer in the country, Ashok Leyland, is understood to be planning some new products for the LCV market, where its share of the market is 0.4 per cent. A mini truck may well be among the new offerings.

The expansion of Tata Ace's line is expected to happen over the next 12 months, as its market expands beyond the five states it is sold in now: Tamil Nadu, Kerala, Andhra Pradesh, Karnataka and Maharashtra. The investment spread is however not known.

A Mumbai-based analyst said that the scenario in the commercial vehicle segment has turned rosier, thanks to Ace. Priced at less than Rs 2.5 lakh, it has made strong inroads among fleet operators as well as single truck owners. Tata Motors executives say Ace is emerging a vehicle of choice for city transport.