India’s automotive market now to focus on premium compacts

The development of ultra low cost cars (ULCC) appears to be on the back burner for auto makers in India as the automotive market focuses on premium compacts. Tata Motors has pushed the ultra-low cost car with the Nano and continues to push sales of the Nano. It is also working on a compact vehicle to be positioned above the Nano and below the Indica. Meanwhile, Maruti Suzuki is working on a revamped Maruti 800 and an indigenous car to be positioned between the Nano and the Alto. Also, Ford Motor Co. and General Motors Corp. have dropped the development of ULCC vehicles. “We do not have any immediate plans to bring products in the ultra low-cost segment. A significant proportion of our products to come will be positioned in the volumes segment that contributes to 70% of industry sales,” said Michael Boneham, managing director of Ford India. General Motors is moving in the same direction. “We are not working on the ULCC project anymore and there are no plans to introduce any ultra low-cost car now,” said Karl Slym, managing director of General Motors India. (August 12, 2011)