I see Maruti and Telco as the leading players five years from now, but Hyundai and Daewoo are unknown quantities ratan tata Chairman, Telco
Telcos small car, being unveiled today in the capital, will give the company front-runner status in the car market, according to company chairman Ratan Tata. In a special interview to Business Standard, Tata said he saw Telco and Maruti as the leading players in the car market five years from now. He added that the two Korean companies, Hyundai and Daewoo, were the unknown quantities partly because they can compete on price.
Tata felt that neither Japanese nor European car companies would be able to compete with him on the critical price issue, while Telcos car was also fully contemporary and competitive in every way.
Tata explained that unlike other imported car models that were being produced and sold in India, the Telco small car which will be formally named closer to the market launch in November is specially designed for the Indian market. Among other things, this means the capacity to seat three passengers in the rear seat.
At an initial price starting from around Rs 2.5 lakh, Tata said he will be offering diesel and petrol variants, and also a deluxe version which will be priced competitively against the Zen while offering several extra features including a rear windshield wiper, power steering and central locking.
Tata said his car project would be viable at 60,000 production volumes, but there would be no capacity restriction because the new car factory being built in Pune can produce up to 1.5 lakh cars per annum. Even if car sales were less, Tata said the new factory could be used to produce other vehicles.
One of the challenges he had to face was to keep costs in control, he said, and disclosed that the total project cost was only Rs 1,700 crore a fraction of what it would cost anywhere else to develop and build such a car. Telco also had the ability to develop new models, at lower cost and with greater flexibility than rival companies, he argued.
The Telco chairman confirmed that he plans to launch a mid-size car next year, and introduce variants of the small car being unveiled today. Unlike the small car, which has used the design help of special design houses in Europe, the mid-size car is a totally in-house project, he disclosed, while adding that the launch of the mid-size car had been deliberately delayed because many companies had already entered the fray.
He said he intends to export the small car, and mentioned several European destinations as possibilities. Telcos distributors overseas had already taken a look at the car, and were keen to add it to their product range in countries like Italy, Spain and the UK, he said. The cars design incorporates environmental and safety features that are now mandatory in Europe.
The biggest problem that the project now faced was vendor development, Tata said. He added that it would be demonstrated how Telcos marketing had developed, since it now had to deal with customers who were not truck drivers.
