Sales have plunged since jumping by triple digits in 2010 and 2011, with VW and SkodaAuto deliveries tumbling 19% year-on-year to 82,239 units in 2013, WardsAuto data shows. Indian production fell by roughly half.
While Mahindra has earmarked Rs40 billion next year for facilities and capacity expansion, Maruti Suzuki roughly will match its rival’s 2015 spending level to develop new models and marketing and upgrade R&D facilities.
Recalling Mahatma Gandhi’s non-cooperation strategy that won independence for India in 1947, the Ford employees are showing up for work but are refusing the company’s offers of a free lunch and free round-trip transportation to and from their homes.
Automakers are making automatic-manual transmissions affordable by simplifying the technology and overcoming the cost disadvantage. AMTs also save money in the price-sensitive India market by offering fuel efficiency equal to, or better than, manual gearboxes.
Stagnant sales are reflected in the decline of the industry’s 5-million-unit plant capacity to 60%-65%. Large discounts and even larger incentives have squeezed profit margins, forcing many automakers to shelve investment plans.
Aiming for a 4% market share in three years from the less than 1% now held by Fiat, the alliance will launch nine new and refreshed models, four each from the Fiat and Chrysler-Jeep family and an Abarth-brand small sports car.
Prospects for hybrids in India look good for two reasons: The cars may offer relief from rapidly rising costs of conventional fuels, and government subsidies may help offset relatively high ownership and operation costs.