Indian trucks conquer alien terrain

Font Size

Print

Feedback

Email

Discuss

Related Articles

M&M set to roll out bikes in 2010VW pitches for 10% market share by ’14Skoda to realign products in IndiaMaruti mulls smarter, greener 800

: For their robust looks, moderate prices and excellent performance, commercial vehicles from India are a big hit in the overseas markets, especially when they are compared with products from traditional suppliers. Easy availability of spare parts is another big reason why Indian commercial vehicles are outdoing those from Europe, Japan and China. Data from the Society of Indian Automobile Manufacturers (Siam) show India’s exports of commercial vehicles went up by a robust 19.10% during 2007-08 at 58,999 units against 49,537 units recorded in the previous financial year.

“Indian commercial vehicles are more successful in global markets as they offer optimum performance at an affordable cost and are matched by a good network. Hence, the USP of Indian commercial vehicles abroad is low operating costs,” says Tata Motors’ official spokesperson.

Adds A Ramasubramanian, chief executive officer (commercial vehicle division), Eicher Motors, “While commercial vehicles manufactured in India are very robust and more suitable to the rugged terrain, those manufactured in Japan and Europe are technically more advanced. Since the countries where Indian manufacturers are operating are very similar to ours, vehicles from India tend to garner a bigger market share compared with others.”

“Moreover, Indian vehicles are priced substantially, almost 25-30% less than the highly technical vehicles supplied by European and Japanese companies. Indian vehicles are also cost-effective. So, they have an edge over their competitors,” he adds.

Tata Motors continues to be the largest exporter of both medium and heavy commercial vehicles (M&HCVs) and light commercial vehicles (LCVs). The company, that is present in 23 countries including South Africa, Sri Lanka, Ukraine, Bangladesh, the UAE and Turkey, exported 13,093 units of M&HCVs in FY08 compared with 11,491 units in FY07, a growth of 13.94%. Similarly, its total export of LCVs went up by 11.21% at 26,099 units compared with 23,468 units during 2006-07.

Ashok Leyland, a distant second, exported 7,076 units of M&HCVs in FY08 as compared with 6,011 units in FY07, a jump of 17.72%. However, the export of its LCVs grew a robust 1,385.7% (though on a small base), to 208 units during April-March 2007-08 compared with a mere 14 units in 2006-07.

Eicher Motors, the third biggest exporter of commercial vehicles from India, also witnessed growth of 30.98% in the export of M&HCVs at 1,019 units in FY08 against 778 units in FY07. However, its export of LCVs witnessed a marginal dip of 2.05% at 1,197 units vis-à-vis 1,222 units during April-March, 2006-07. This was partially due to the company’s increasing focus on M&HCVs.

Interestingly, Indian vehicles are more in demand overseas compared with those from China despite the fact that Chinese vehicles are priced lower than the commercial vehicles made in India.

“Although Chinese vehicles score over Indian counterparts in terms of superior fit and finish, in terms of robustness, reliability and cost of maintenance, commercial vehicles manufactured in India are far more superior and hence more in demand,” says Ramasubramanian from Eicher Motors.

“While both Indian and Chinese vehicles are equally affordable, commercial vehicles from India offer durability, a wider network and easy availability of spare parts than those from China,” adds a Tata Motors spokesperson.

Not just this, even within the commercial vehicles segment, the country’s M&HCVs are in intense competition with the LCVs to dominate markets abroad. M&HCVs have been more in demand until some time ago. But lately, the LCVs have taken the lead.

“The economies of countries in South Asia, West Asia and Africa, which are major markets for Indian vehicle makers, are much similar to the Indian economy in terms of lack of good infrastructure. Therefore, it does not permit the movement of big M&HCVs,” explains an industry expert, adding that this is primarily one reason why Indian LCVs have forged ahead of the M&HCVs.

SIAM figures reflect that the export of M&HCVs went up 18.75% to 22,100 units for the financial year ending March 2008 compared with 18,610 units during the same period last year. Similarly, the export of LCVs from the country was up 19.31% to 36,899 units during FY08 against 30,927 units in FY’07.

“Earlier, there were not many offerings in the small and light commercial vehicle segment vis-à-vis the products in the M&HCV segment. But now, with all leading players introducing new products in this category, there have been more choices available,” says a Mumbai-based auto analyst, adding that the growing demand of CNG vehicles in countries like Bangladesh has further fuelled the export of LCVs.

Surprisingly, the growth in exports had happened at a time when the rupee had appreciated by 14% to the dollar over the last few months. “Despite the dent in margins due to the rupee appreciation, we will continue to focus more on export volumes to balance the impact of the cyclical nature of the domestic industry,” says Ramasubramanian.

Agrees the Tata Motors spokesperson. “We believe that there’s a huge potential for exporting commercial vehicles and the company plans to harness this potential by focusing on select markets.”