The power of 'one'

Many foreign car brands struggle for recognition beyond their flagship models

Mumbai-based Shubham Naik (46), a civil engineer, knows the difference between Android and Windows-powered handsets but when it comes to identifying models of foreign car makers, he is confused.

"I know that the Duster is made by Renault but beyond that I would need Google", says Naik when asked to name any of Renault's other five models.

It's not without reason. For example, the Duster generates 91 per cent of Renault India's total domestic sales, dwarfing the remaining five that includes a hatchback, a sedan and a sports utility vehicle (SUV).

Last financial year the French car maker recorded sales of 43,384 units, of which 39,279 units were Dusters, its Mahindra Scorpio-rivalling compact SUV. Hatchback - Pulse -- which competes with Hyundai Elite i20 (on price) recorded volumes of 2,301 units during the same year, an average of less than 200 units a month.

Until 2013-14 Renault's overwhelming dependence on the Duster was fine as sales headed north. But when SUV market leader Mahindra & Mahindra launched an all-new Scorpio last year Duster sales took a hit. Renault sales last year slipped 24 per cent while that of Duster went down by 16 per cent.

US-based Ford Motor Company finds itself in a similar spot. Despite having five models, the EcoSport continues to be its biggest seller, commanding a share of 71 per cent of sales last year. The super compact urban SUV dominated other Ford models which includes a hatchback, two sedans and a SUV.

Ford India clocked 75,138 units last year of which the EcoSport sold 52,058 units. While EcoSport volumes marked a growth compared to 2013-14 volumes (45,008 units) Ford's total domestic sales dropped 11 per cent compared to 2013-14 volumes (84,469 units).

Honda, the second biggest Japanese car brand in India, had to fall back on its flagship model City. As much as 56 per cent of its volumes are driven by the City alone.

While the Amaze compact sedan attracted car buyers, accounting for 28 per cent of Honda's domestic volumes, the Brio hatchback continued to be a drag. However, Honda officials are not disappointed.

Jnaneswar Sen, Sr. Vice President, Marketing & Sales, Honda Cars India, said, " The Brio numbers are as per our plan which is evident from the fact that it is not on any discount despite being in a heavily discounted segment".

Analysts tracking the sector say that some companies have struggled to move beyond their flagship purely because not enough efforts were made to challenge market leaders .

Abdul Majeed, partner, national automotive leader, PwC said, "For some manufacturers it was their choice to be a major in a particular segment because that is how one can get started in a market. But some of them have been stuck within that segment."

India's top two car makers Maruti Suzuki and Hyundai, which control 64 per cent of the domestic market, has an evenly spread out sales chart. Toyota has learnt this lesson. The Bangalore-based company has managed to drive down the share of its top-selling product Innova in the last one year while pushing its hatchback and sedan, Etios Liva and Etios, respectively.

Innova, which is the largest selling product in its category, commanded a share of 44 per cent by the end of last year as against 47 per cent clocked in 2013-14.

N Raja, director and senior vice president (sales and marketing) Toyota Kirloskar Motors said, "The Etios has been constantly receiving good acceptance from the customers especially since the launch of the new Etios and Liva, when the airbags were standardized across all grades of the Etios series. In 2014 we sold 70,737 units of the Etios series, in comparison the Innova sold 59,447 units (in the same year)".

Renault, Ford and Honda are working towards finding a solution to this. While Renault is preparing to launch an all-new hatchback Kwid later in the year, Ford will launch a new compact sedan called Aspire and the new version of the Figo hatchback. Honda too will launch the all-new Jazz, a premium hatchback in the next few months.