The first quarter of next fiscal will be good for CV sales: Vernon Noronha

By: |
Published: January 24, 2015 12:05:48 AM

Last week Tata Motors showcased a range of buses across segments at the SIAM Bus & Special Vehicle Show in Greater Noida...

Last week Tata Motors showcased a range of buses across segments at the SIAM Bus & Special Vehicle Show in Greater Noida near Delhi. These included Tata Ultra Safe school bus, Ultra Midi, Ultra BS4, 1512 Luxury Bus, Articulated Bus, among others. Although commercial vehicles (CVs) are going through a downturn, the company expects that the first quarter of next fiscal will be good for CV sales. Vernon Noronha, vice-president, Defence & Government Business, Tata Motors Ltd, in an interaction with FE’s Vikram Chaudhary, says “from November 2014 onwards we have been seeing a rise in the sales of heavy commercial vehicles (HCVs), and that bodes well for the industry.” He adds that the next big opportunity for the company is hybrid buses. Excerpts:

CV sales have gone down from 8.14 lakh units in 2012 to 6.06 lakh units in 2014. With the expected rise in economic growth, will sales recover?
From November 2014 onwards, we have seen a rise in HCV sales; it is the HCVs that start the upturn, LCVs follow the trend. The good news is that bulk orders have started coming in. We are hopeful that the first quarter of next fiscal will be good for CV sales.

What are your alternative fuel vehicle plans?

The government is on the right track as far as alternative fuel vehicles are concerned. The National Electric Mobility Mission (NEMM) is encouraging people to look at hybrids seriously. We have taken the lead in hybrids (during the Commonwealth Games we gave two CNG-electric hybrid buses to the DTC). We are in talks with Navi Mumbai Municipal Transport and Bangalore Metropolitan Transport Corporation (BMTC). Both floated tenders for hybrid buses and Tata Motors was the only company to respond. We hope to see orders within 2-3 months.

These would primarily be intra-city buses, right?

We have a plan to introduce inter-city hybrid buses also. In fact, that is the way to go; because inter-city bus orders can be bigger than intra-city bus orders.

Why are you so gung-ho on electric hybrid?

Because this technology does not call for major infrastructure changes. For pure electric buses a lot of investment has to be made in docking stations, charging points, etc, but in hybrid buses you don’t need charging infrastructure, because the engine charges the batteries on the go.
Our series CNG hybrids are already in operation in Madrid and have together covered more than 4 lakh km. We have also developed parallel hybrids for use in suburban areas where average speeds are over 30 kmph. We also give a warranty of 4 years for Lithium-ion Nano phosphate batteries.

Who is the expected buyer for these hybrid buses?

Initially it will be forward-looking transport organisations such as BMTC, DTC, BEST and Hyderabad Municipal Transport.

How much do these buses cost?

They cost three times more than a conventional fuel bus, but a hybrid has long-term savings.

What steps are you taking to enhance bus & truck driver safety?

Safety is inherent to design. We have a JV with Marcopolo and we manufacture buses and coaches in Dharwad, Karnataka. These vehicles are not simply bodies bolted to a chassis. There is a bus body code coming in—most of it has been implemented—which will bode well for this industry.

Should body-building be done by third parties or by OEMs? Currently OEMs manufacture the chassis and most body-building is done by smaller players…

I am not saying that OEMs have to do the body-building job; even a small body-builder can build a safe bus. But the problem is that most such body-builders in India don’t have the engineering capability to build safe buses. So companies like Tata have to bring them on board. We can even franchise our design to these body-builders.

But such measures can raise the cost of the vehicle…

Safety has a cost—initial cost, I must say. At least the chances of your vehicle meeting with an accident that is caused by a faulty design are reduced.

What steps are you taking towards driver training?

We have partnered with various state governments and are providing them with trainers for their driver training schools. As bus and truck technology is scaling up—automatic transmission will soon come in a big way, ABS is now mandatory in HCVs—training becomes all the more important.

Do you see a business opportunity in driver training? Making money on training…

That is not our core business; our core business is the design and manufacture of buses and trucks. The reason we are into training is so that our vehicles deliver what we promise to our customers. For example, we assure our customers good fuel-efficiency, better tyre life, low repair costs, etc. All this can go haywire if the vehicle is being operated by an untrained driver. That’s the reason we take driver training very seriously. A trained driver is fundamental to improving our sales.

Why hasn’t Tata explored the inter-city luxury bus market? Volvo Buses is practically ruling the segment. Even Daimler has entered. Do you have a product, or technology?

We have a plan. We will catch up with them.

Those buses run on powerful engines, ranging from 280-340 horsepower. Tata Marcopolo buses have less powerful, 230-horsepower engines…
We are fitting 380-horsepower engines in the Tata Prima trucks. So technology is not an issue. We will soon explore the inter-city luxury bus market.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.