French carmaker Renault, whose sports utility vehicle (SUV) Duster saw runaway success in India, now plans to launch a sub-Rs 4 lakh hatchback and a mutli-purpose vehicle (MPV). Spearheading the next phase of growth is country CEO and managing director Sumit Sawhney, who took charge in January. In an interview with Rachit Vats, Sawhney talks about the company?s strategy to drive volumes and go up the pecking order from its current ninth position. Excerpts:
Duster has helped you establish a footprint in the SUV space. Are more products lined up for launch?
Next calendar year, we plan to launch two volume products. With them, our target is to achieve a market share of over 5% in the next two years, from around 2% currently. The planned launches are a sub-Rs 4 lakh hatchback and an MPV.
The passenger vehicle market is witnessing a slowdown. What makes you bullish?
Despite the slowdown, new launches are triggering growth. However, it?s true that growth in July-August was due to a very low base. Small car sales are going to boom with economic indicators turning positive. The MPV segment, too, is big volume churner. We are going to be just in time to leverage this opportunity.
Is the narrowing of price differential between diesel and petrol a worry?
Not really. The consumer preference for Duster is largely due to diesel, but we are strong in petrol as well. Going forward, petrol would be preferred in the small- and mid-size segment and diesel would be the preferred option beyond it. If you look back, in 2010, this was the trend when the price gap between petrol and diesel in Delhi was just Rs 10, which is comparable to the present price trend.
Is the worst over for the Indian passenger vehicle market?
Buyer sentiment is high, though the bigger impact will be seen next year. It takes time to build confidence ? it doesn?t happen overnight. The next Budget would clarify things a lot. As of now, we see the government?s commitment to push manufacturing, which would key to growth.