Stock Market

Can Tata Motors break the jinx with Hexa?



Swaraj Baggonkar
Chillicious Bureau
 
Tata Motors made the giant leap once again pricing its latest product Hexa in the premium category nearly double the most expensive car in its portfolio, the Manza.
 
At Rs 11.99 lakh (ex-showroom, Delhi) the seven-seater, five-door, premium sports utility vehicle, Hexa is the most expensive in the Tata line-up. It has launched with six variants, the top-end model being priced at Rs 17.49 lakh. The Manza, on the other hand, is priced at around Rs 6 lakh.
 
The new Tata SUV will take the Mahindra XUV500 head on having been priced nearly Rs 50,000 cheaper. A few smaller and comparatively cheaper models such as the Hyundai Creta, Renault Duster, Nissan Terrano, Mahindra Scorpio and Honda BRV will also compete against the Hexa.
 
The Mumbai-based maker of cars such as Nano and Indica has not had much of a success in the premium category (above Rs 10 lakh). Aria, the multi-seater utility vehicle, which the Hexa has replaced, was a costly gamble by Tata Motors, launched in 2010. It failed to generate healthy volumes forcing the company to discontinue it.
 
Many in the market perceive Tata Motors as a manufacturer of cars who is popular amongst the commercial users of cars such as cab aggregators and city-based taxis even though the company had stopped selling cars to such buyers a few years ago and given priority to personal buyers.
 
“They have to first come out of (the) taxi image for their vehicles and need to work more on design to appeal people”, tweeted Razive through his handle @razive.
 
“Tata SUVs lack the finesse and class. Other companies make much better products in the same price range”, tweeted Ayushman Dash from New Delhi.
 
Each of its eight current offerings in the passenger vehicle segment are priced below Rs 6.5 lakh (ex-showroom, Mumbai), that includes micro car Nano, hatchback Indica, Tiago and Bolt and compact sedan Zest and Indica CS and mid-size sedan Indigo Manza.
 
Though the company has been the earliest manufacturer of SUVs in India its products like Safari and Safari Storme has struggled against Japanese, Korean, American and Indian competition.
 
Tata Motors senior management agreed that the company has faced issued in the premium segment in the past but is ready to start on a clean slate.
 
“There are lot of products (in the market) which look like sports utility vehicle but or not sports utility vehicle. With the Hexa we have entered the true blue SUV market”, said Mayank Pareek, president (passenger vehicle business unit), Tata Motors at the press event today.
 
Pareek was referring to the soft roaders such as Hyundai Creta Ford Ecosport and Maruti Brezza which are primarily driven in the urban centers and cannot offer much of off-roading experience.  
 
“It is indeed a challenge but we have learnt from what we had done earlier. My experience is that if the product meets or even exceeds customer expectations then they will buy it irrespective from where the product is coming. We have to make sure that whatever product we launch be it Hexa or anything else it has to be a cut above anything else in the market”, said Mayank Pareek, president (passenger vehicle business unit), Tata Motors.
 
Further, according to market sources the Hexa has seen booking swell to a ‘few thousand’ even before its launch with Pareek adding that the vehicle has a waiting period of eight weeks. What has surprised the company is that about 60 per cent of buyers have gone for the automatic version.
 
Maruti experience
When car market leader Maruti Suzuki who has a share of more than half of the small hatchback segment, decided to enter the premium segment, the company carved out a separate retail format for the risky venture.
 
A separate chain of dealerships under the Nexa brand was thus launched which housed premium products compared to other usual Maruti products.
 
Since the launch of S-Cross followed by Baleno and now Ignis, all of which are sold through the Nexa chain the Delhi-based company has rapidly changed gears. Baleno dislodged the reigning champion of the premium hatchback segment Hyundai i20 Elite. Ignis has started to garner the same response clocking bookings even before its launch last week.