Maruti Suzuki India Ltd., the country's largest passenger vehicle manufacturer, may command a 47 percent market share in terms of sales, the bulk of which comes from the affordable hatchback segment, but what Maruti would never do is try and build a Nano, said Chairman RC Bhargava.
While he lauded Ratan Tata's vision of building a Rs 1 lakh car, Bhargava conceded that Maruti Suzuki would have never been able to produce such a cheap car, at the same time acknowledging that the car had failed to meet buyers' aspirations. Bhargava was speaking to reporters at a media conference held by Maruti.
Recently, Tata Sons' ousted chairman Cyrus Mistry had in an email to directors outlined the many financial challenges facing the Tata Group. Of the Nano he said it had no line of sight in terms of profitability and was not being discontinued only due to emotional reasons.
Tata Motors Ltd. had launched the Nano - the world's cheapest car - in 2008, at a promised introductory price tag of Rs 1 lakh. The project was initiated by none other than Ratan Tata after he saw a family of four travelling on a two-wheeler in the rain, and had wanted to make a car for them, he had famously said.
But Nano has not yet found commercial success.
Not Too Worried About GST
Speaking about the four tiered Goods and Services Tax (GST) rate finalised by the GST Council today, Bhargava said he didn't see the same having a significant impact on consumers. He said he believed the government would stick to its promise of not making major changes in tax rates via GST. When asked about the possibility of different car categories being taxed at different rates Bhargava reiterated that he did not expect any big changes and that he would rather wait for the government to share details before commenting on it.
Government's Reforms Drive
Lauding the government's policy initiatives, Bhargava said India could grow at a sustained rate of 8 to 10 percent per year if such policies were to continue for 5 to 10 years.
Hailing Taxi Aggregators
Bhargava embraced the sharing economy and said he didn't think taxi aggregators like Uber and Ola are eating into vehicle sales, with more people choosing to take taxis, rather than buy cars. He said such services were actually beneficial for the automobile industry as more taxis also suggested a shorter replacement cycle.
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