Cheap MPV may not be the + Datsun needs to GO ahead in India

Cheap MPV may not be the + Datsun needs to GO ahead in India
Highlights

Nissan Motor Co Ltd hopes to boost its low-cost Datsun car brand in India with a new compact multi-purpose vehicle, or MPV, but the Japanese automaker might need to make inroads into smaller cities and the countryside if it wants to revive sales.

Nissan Motor Co Ltd hopes to boost its low-cost Datsun car brand in India with a new compact multi-purpose vehicle, or MPV, but the Japanese automaker might need to make inroads into smaller cities and the countryside if it wants to revive sales.

Last month, Datsun unveiled its second offering, a seven-seater, in a country where three generations often live under the same roof and spacious sports utility vehicles are pricier.
The minivan’s base variant is priced at 379,000 Indian rupees ($6,148), making it around 219,995 rupees ($3,569) cheaper than Maruti Suzuki’s seven-seater Ertiga. And Nissan thinks the GO+, the only MPV in the market with a length short of four metres, could be a “trend setter”.
“It can modify actually the perspective of the Indian market. It can be a market breaker and I think, yes, it could also change the Datsun position in the market.” Guillaume Sicard, President–Nissan India operations, said in an interview.
Nissan resurrected Datsun, a budget brand which began production in the 1930s, in India last year with the GO to tap the growing middle class in emerging markets. It sold only 12,000 cars, below analysts’ estimates.The Renault-Nissan hatchback 'Datsun Go' is pictured after its launch in Gurgaon on the outskirts of New Delhi July 15, 2013. REUTERS/Adnan Abidi/Files
In comparison, India’s top car maker Maruti Suzuki sold 309,845 mini hatchbacks, which include WagonR, a car favoured by taxi drivers, and its best-selling Alto, in the first nine months of fiscal 2014-15.
Even as the GO+ could bend the scales in Datsun’s favour in a price-sensitive market like India, the lack of an expansive dealership and service-centre network in small towns and country areas could hurt sales.
“It’s a seven-seater which will find usability in certain markets,” said Deepesh Rathore of consultancy EMMAA. “The problem is that Nissan doesn’t have the reach in those markets.”
Nissan wants to change that. Sicard said he planned to double dealerships to 300 from around 150 at present in another two years, increasing their footprint in tier II and tier III cities.
The company is also likely to set up Datsun-only showrooms once it gains a foothold in the Indian market. Most Datsun showrooms are combined with parent Nissan’s.
Until that happens, some customers remain skeptical about buying a car brand that lacks recognition and is just a year old in India.
“I’m from Garhwal and I don’t know if they have an after-sales service network there. I once took a Ford to Himachal, and we had to get the car towed [after it broke down],” said Sukhdev Rawat, 38, who works at a packaging company and often travels to his hometown in the northern mountainous state of Uttarakhand.The looks of the car have also left some unimpressed.
“It has got so many design elements shared with the GO, the hatchback counterpart, that people might not really be that much interested in owning an MPV which has got underpinnings and the design elements common with a hatchback,” said Anil Sharma, a senior analyst with IHS Automotive.
But not all prospective car buyers are unhappy. Its affordable price and promotional blitzkrieg have attracted buyers like Satya Prakash to the GO+. The promised mileage of 20.6 kilometres to the litre is a plus too.
“It has seven seats, its average is good and is within my 500,000 (rupees) budget. This is my first choice,” said Satya Prakash, 26, who chose the Datsun as his first new car ahead of his wedding.
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