Tata's Ace mini-truck suddenly gets competition

Mahindra’s Maxximo grabs 24% share in west & north over just 2 months. 

The Tata Ace, market leader by a huge margin in the mini-truck segment, may have to gear up for some competition. 

Sales of the newly launched Mahindra Maxximo have seen a swift rise. Within two months, the new entrant has managed a 24 per cent share in the western and northern markets. 

Mahindra & Mahindra (M&M) is doing a region-wise launch, starting with the north and west and entering the eastern markets a month earlier. “With the performance in the west and north, we had the confidence to launch it in the east. We had good expectations, as it is a superior product,” says Vivek Nayer, senior vice-president, marketing. 

The Maxximo is the first in the segment to be powered by a two-cylinder CRDe engine. While it offers a higher payload of 850 kg as compared to the 730 kg of the Ace, the Maxximo BS-III variant is priced at par with the BS-II variant of the Ace, at Rs 2.84 lakh. 

Tata Motors’ dealers in Delhi, Mumbai and Ahmedabad that Business Standard spoke to admitted on condition of anonymity that there indeed had been an impact of the Maxximo on the mini-truck market, but added that the segment itself had also grown by over 30 per cent in 2009-10. 

The Ace, launched in 2005, offered a solution for last-mile connectivity on goods and has been a runaway hit. It enjoys 90 per cent market share in the segment. Starting with sales of about 30,000 units in 2005-06, its footprint more than doubled in 2006-07 to over 70,000 and further grew to over 89,000 units in 2007-08. Even in 2008-09, a year impacted by the downturn in the commercial vehicles industry, it clocked sales of over 81,000 units. 

Tata Motors did not share sales and market share figures. The Ace is, however, reported to have crossed the 1,00,000-mark to reach 1,10,032 units in 2009-10 sales. 

A company spokesperson said: “Tata Motors cannot provide any information now, pending declaration of the company's financial results on May 27. Ace sales in Q4 of 2009-10 fiscal and March 2010 were the highest-ever monthly and quarterly levels.” 

ACTION IN 0.5-T MARKET, TOO

The competition is set to warm up in the 0.5-tonne goods carrier segment as well. M&M came up last year with what it called a compact truck, the 500-kg Mahindra Gio. It was priced at Rs 1.67 lakh, close to the price of a three-wheeler, but offered a much higher payload, compared to the 200-300 kg for the latter. 

As a result, Nayer says, the company managed to double its market share in the segment from 15 to 30 per cent in the second half of 2009-10. Tata Motors is preparing to also come up with a 0.5-tonne compact truck, codenamed the Penguin, to take on the Gio. The Penguin is based on the Ace platform and will be targeted at intra-city travel. 

In June 2007, Tata Motors had launched the Tata Magic, developed on the Ace platform, as a comfortable four-wheeler for public transportation. Already a hit in semi-urban and rural areas, Magic sales in 2009-10 wee close to 49,000 units, a growth of 71 per cent over the previous year. The company plans to stay ahead of competition by coming out with the Magic Iris, a passenger carrier based on the Penguin platform. 

Asked about passenger variants of the Mahindra Maxximo and Gio, Nayer said: “We have launched an entirely new platform with the Maxximo and Gi, and would continue to roll out fresh variants on the same, but a time-frame is yet to be decided.”