India Will Be Datsun’s Biggest Market Globally: Nissan Motor India
India is a large market where we have not penetrated enough. The ratio of a two wheeler to a four wheeler is 5.5:1 and is expected to reduce in the future, says Arun Malhotra
Nissan Motor India Pvt Ltd (NMIPL), which has a portfolio of two brands i.e. Nissan and Datsun, is looking to achieve a 5 per cent market share in the domestic passenger vehicle (PV) market by 2020. Speaking with BW Businessworld exclusively, Arun Malhotra, its Managing Director stated that India will be the leading market for ‘Datsun’ globally.
How do you see the passenger vehicle market in India evolving over the years?
In the mid-80s when the size of the market was 46,000 units per annum, nobody would have imagined that it will be 3 million in three decades. There are two major evolution that have taken place (in the PV market). One is a shake-up across segments and the other is evolution in terms of features, technology. For example, while we have Euro-IV norms across the country, there are a number of advanced countries still complying with Euro-III norms.
Moreover, the price value equation this industry is giving is phenomenal. So the automotive industry has come a long way, generating employment and other opportunities. More than anything else, the aspiration of individual mobility has caught on. In terms of numbers, our industry is expected to register 18 million two wheelers and 3 and a half million passenger vehicles, which would be bigger than even the US.
As the consumers’ holding period is coming down, do we see a trend of a shorter life cycle of cars?
Not exactly. It depends on model to model. I think the life cycle (of the car) is decided by the customer and not by the manufacturers. There are models which are existing for more than 20-25 years in the market. For example, a tallboy (WagonR) launched by a leading player (Maruti Suzuki) is still doing well in the market for two decades.
What would be the key growth drivers for the car market in the next few years? Besides that, what are the other critical enablers for robust growth in sales?
The key growth drivers would be stable tax regime, better road connectivity, improving infrastructure, etc. Major economic reforms introduced by the government during the last three years have helped to create a positive environment for business in India.
Also, the implementation of business-friendly policies and key initiatives like Make in India, Digital India and Skill India by our Prime Minister have enabled India to become one of the fastest-growing economies among the emerging markets. Besides these, the other critical enablers would be infrastructure push (by the government), further reduction in tax rates and vehicle financing. India is a very dynamic market in terms of customers’ tastes and preferences.
How has Nissan reacted to the goods and services tax (GST) implementation by the current government?
We welcome the introduction of the GST bill in July. We believe it is a positive move by the government that will make doing business in India easier with greater transparency. We also are in favour of the government’s taking action to lend support to electric vehicle manufacturers which would make electric cars more affordable for car buyers.
Do you expect India to be the largest market for Datsun worldwide? If yes, please can you a put a timeline for the same?
Yes, absolutely! India will be the largest market for Datsun worldwide. Being a new entrant (in 20014), we had a reasonable success here. We have sold 90,000 units and aiming to do much better in the market. We have already put in place the basics of products, technology, enablers, etc. Moreover, India is a large market where we have not penetrated enough. The ratio of a two wheeler to a four wheeler is 5.5:1 and is expected to reduce in the future.
Nissan India is committed to government’s initiatives such as Make in India that positions India as a major manufacturing hub. Since beginning operations in India in 2010, Nissan has exported over 700,000 cars from the country and has made a large contribution to the Indian economy in terms of investment and employment.
With Datsun taking care of the budget segment, will Nissan be focussing on the premium segment?
There are two parts to it. Firstly, Datsun is in the ‘rising’ segment and we are focusing on that. Secondly, Nissan is for ‘International India’ and will be more into innovation, technology, etc. In the domestic PV market, we are eyeing a 5 per cent market share by 2020.
Do we see some roll outs in the sedan or sports utility vehicle (SUV) segment for either of your brands? Also, are you also considering electric vehicles in the future?
We have planned 8 launches for the next four years out of which four will be from Nissan’s stable and the remaining one will be from Datsun. Electric vehicles could be one of the options going forward.
As the country’s luxury car market is growing at a brisk pace, are you interested to bring the ‘Infiniti’ brand in the medium to long term?
At present, we are busy with the two existing brands and are channelizing all our energies for enhancing their reach. We are not thinking about that (bringing Infiniti) at least in the distant future.
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