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Small cars hog Indian limelight

2010-01-05 10:44
A host of new small cars jostled for attention on Tuesday at the start of the Indian auto show, a showpiece event for compact vehicles in one of the world's fastest growing markets.

In a sign of the attraction of India for foreign manufacturers, Japan's Toyota took the wraps off its first compact model designed especially for the country.

The Etios will probably be launched later this year, the company said, featuring suspension designed for bad roads and a price - so far undisclosed - that will attract middle class families and professionals.

"It's not a copy of a Japanese or European model," said Kazuo Okamoto, vice chairman of Toyota, at the presentation. "Etios is newly developed for customers in India."

This year's show is the 10th, but it first caught the world's attention in 2008 when Indian manufacturer Tata Motors unveiled its Nano, the world's cheapest car that has since hit the roads.

The 115 000-rupee (2 500-dollar) Nano kickstarted the race to produce cheap, small vehicles, which account for 80% of all car sales in India.

Total car sales are forecast to reach two million this year and triple in the next decade, according to industry estimates.

Stampede to India

AutoExpo 2010, which runs in New Delhi until January 11, features global releases of cars designed for India's new consumer generation, whose appetite for vehicles is driving sales growth of more than 10% a year.

Recent months have seen foreign giants Ford, General Motors, Hyundai and Renault join a stampede to India, where each has promised a small, cheap model designed for what Ford boss Alan Mulally termed the "sweet spot" of the market.

Japan's Honda was also set to unveil a compact car for India, while General Motors' new vehicle for the market, the Beat, and the India-made Polo by Germany's Volkswagen will also be on display.

Organisers are keen to stress the range of cars and technology at the show, the 40% increase in exhibition space compared with the last edition in 2008 and the more than 2 000 exhibitors from 30 countries.

"That's what makes us feel now that Delhi is as big and as important as any auto show in the world," Pawan Goenka, president of the Society of Indian Automobile Manufacturers (SIAM), told reporters Monday.

Tough competition

Ahead of the event, General Motors took the wraps off the Beat which it intends to sell in more than 150 countries worldwide including Europe, parts of Asia and North America.

Karl Slym, head of GM India, said the Beat, priced at 334 000 rupees (7 000 dollars) in its basic form, would help increase Indian sales by 30% this year to 100 000 units, but he admitted that the competition was getting tough.

"There is a competitive market in India," he told reporters. "There are more and more players coming in with different capabilities."

All new entrants are looking to unseat Indo-Japanese alliance Maruti Suzuki, which accounts for 55% of all car sales in India and has been a top selling brand for two decades.

Incomes are rising steadily, meaning Indians are following the familiar pattern of upgrading their personal transport from push bikes, to motorbikes, then to cars.

Ten global launches of vehicles from heavy trucks to two-wheelers are planned at the Delhi event, which will see an expected 1.8 million visitors pass through its doors.


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