This mongrel has to mark its territory

Exactly four years after showcasing a concept ultra-low-cost car, Bajaj Auto released its version of a marketable four-wheeler. It’s a vehicle that’s too odd to be a car and too smart to be the traditional auto-rickshaw, leaving consumers guessing. Comparisons with the Nano, India’s first frugally engineered four-wheeler, will be inevitable, though misplaced. For Bajaj, however, this four- wheeler fits into a space that the Nano could have aimed for, but passed.

With the RE60, which is the mongrel’s name, Bajaj has firmly positioned it as the extension of its existing auto-rickshaws, which go by the RE brand. To a buyer of cars, the RE seems uninspiring, nowhere as catchy as the Nano, which is what car-buyers may initially compare it to. To its loyal customer, though — the auto-rickshaw driver — it is serving up a very different proposition.

It is giving the three-wheeler driver a four-wheel option that helps him stand taller in the taxi rank on Mumbai’s streets, and that gives his passengers a more dignified ride. In short, it strikes an aspirational chord with the low end of passenger-carrying segment, an opportunity for an auto-rickshaw driver to have a quasi-taxi, and a top speed (70 kmph) that he would never test anyway on India’s overcrowded city roads. Bajaj is wooing an existing user and brand loyalist.

That’s very different from the Nano, which positioned itself as a leap for the high-end two-wheeler user or, as Ratan Tata now says, a family car. The Tatas have a tougher task of wooing customers who are either unfamiliar with cars or possibly have no loyalty to any particular brand and will be equally swayed by low-end and previously-owned offerings of rival car makers such as Maruti Suzuki.

Bajaj is also attempting to weigh down consumer expectations, by desisting to position its four-wheeler as a car. The vehicle clearly does not compete on performance, or even looks. Its engine capacity, at 200 cc, is less than that of bigger 250 cc two-wheelers in the Bajaj stable. And it weighs only 400 kg, much lighter than the Nano and other small cars. It has a soft flap-back version and a taxi-meter, instantly stamping the impression of a rickshaw. Buyers of this vehicle will easily associate it with its poor cousin — the three-wheeler. For flamboyance, there’s a steering wheel thrown in.

To be sure, the RE60’s positioning carries a risk that any new category holds. That’s all the more true for users who are not transiting from the existing auto-rickshaw. Such consumers could start comparing the RE60 to a car and will then expect all the features of a car, which would include better performance and a snazzier look and feel. That’s an obfuscation that Bajaj will have to work hard to prevent, because that’s where the Nano, by being a car, is likely to score, because it would deliver the performance of a car.

The other tricky territory that Bajaj will have to navigate is pricing. Auto-rickshaw owners may be willing to spend only slightly more to upgrade to a fancier version of a brand, which by association is a three-wheeler. That coupled with the fact that the Nano, albeit a different concept, is available from ~1.4 lakh, could test the limit on the pricing of the RE60, at least in some users’ minds. Bajaj has always argued that the low cost of running a vehicle, not the initial cost, is the winner, but only a CNG or LPG variant would help seal that argument, hardly a petrol version in a free-pricing regime.

The real test for this mongrel, then, will be to mark its territory and firmly guard it.

Anjana Menon is a Delhi-based writer