Friday, August 01, 2008

Not Small anymore

Toyota’s small car is all set to give that extra edge to the booming compact car segment

at first there was the ubiquitous Maruti 800 that dotted Indian roads, which gave way to the larger Zen and Hyundai Santro. Soon after, with the launch of Fiat Palio and the relatively more successful Maruti Swift, consumers got a taste of larger ‘small’ cars, which were affordable, comfortable and surprisingly easy to drive in congested areas. Latching on to the potential, Honda and Toyota (who had earlier shied away from launching ‘small’ cars in India) too are jumping into the fray. If the impending launch of Honda Jazz was not enough to fuel the demand for compacts, Toyota’s announcement of launching its compact car (in an expected price range of Rs. 3.5 to 4.5 lakh), has set more tongues wagging.

Thanks to government stipulations, despite being broadly in the small car segment, the larger and roomier models are being positioned in the B+ to B++ segment instead. A car is justifiable as a small car only if it is within prescribed length limits, but most new generation launches hardly meet these guidelines. And a look at the sales charts of various auto manufacturers shows that the A segment (shrinking year on year by a staggering 16-18%) is slowly becoming extinct in favor of the fast-expanding B segment (appreciating by at least 14% per annum).

For Complete IIPM Article, Click on IIPM Article

Source :
IIPM Editorial, 2008
An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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