Nexon is a very late entrant into the compact SUV market, which is already crowded by a host of other players.
Tata Motors on Thursday unveiled Nexon, a compact SUV, taking the fight to rival Maruti Suzuki’s Vitara Brezza and Ford’s Ecosport with a competitive price range starting at Rs 5.85 lakh (ex-showroom Delhi). The launch will help the company increase its addressable passenger vehicle market to 71% from 59% earlier. Nexon is a very late entrant into the compact SUV market, which is already crowded by a host of other players. However, Mayank Pareek, president of the passenger vehicle business unit, Tata Motors, feels otherwise. He said, “I don’t think we are too late in the compact SUV segment. In fact, this segment is still at a nascent stage and we are entering at a very competitive price. So I feel we are at an advantage.”
The entry variant of Vitara Brezza, which holds the leadership position in the compact SUV space, is costlier by more than Rs 1 lakh compared with the Nexon. However, prices for Nexon declared for now are merely introductory. Following an undisclosed period, prices are slated to rise. With the Nexon, Tata Motors continues its bid to transform its image. “Over 50% of our buyers earlier were fleet operators. But that trend has changed. Today, 81% of our customers are personal car buyers,” said Pareek.
The product will be targeted towards millennials and family car buyers and will be the fourth new model to be launched in the last two years. Just like the previous three models – Tiago, Hexa and Tigor – Nexon too will be based on the company’s ‘Impact Design’ philosophy. The company is now mulling expansion into other segments in the passenger vehicle segments, namely the sedan and the premium hacthback spaces. Pareek said, “As part of the aggressive turnaround strategy, we have renewed focus on filling in product gaps and tapping the white spaces that will emerge.” The new launches would be based on the company’s X4 platform, which is also called the advance modular platform. The company is going to invest around Rs 2,500 crore this fiscal on the new platform and says its launch can lead to economies of scale for the automaker.
Tata Motors had earlier said it would embark on a complete turnaround phase, which can last for around six-nine months. Guenter Butschek, CEO and managing director of the company, said, “For now, our aim is to bring the standalone business back to profitability.”