Rediff Logo Business Banner Ads
Find/Feedback/Site Index
January 22, 1998


Citibank : Home Loans Ad

GM to go small in India with Opel Corsa

Kevin James in New Delhi send this story to a friend

If Hyundai, Daewoo, and Mercedes are entering the small car segment in India, can the grand old General Motors be far behind? The United States auto multinational, the largest car maker in the world, has jumped on to the bandwagon with its popular small car, the Opel Corsa (below).

As per the company's plans, General Motors India Limited, GM's Indian venture with the C K Birla promoted-Hindustan Motors, will launch the Opel Corsa in the Indian market by mid-1999. The car will be available in both the petrol and diesel versions.

Richard Swando, president and managing director, General Motors India Limited, explained the positioning and the pricing of the Corsa. "As the Opel Corsa is a small car, we will place it at par with the Maruti Zen. But our car will be slightly more expensive than the Zen," he said.

The Opel Corsa, a 973 cc vehicle with a 55 bhp engine, has been highly successful in the European market. Currently, the company is conducting a market feasibility study as a precursor to its introduction in the Indian market.

Incidentally, the first car from the GM-HM joint venture, the mid size Opel Astra, is already visible on Indian roads and the response to it has been encouraging.

Referring to the popular mid-sized Opel Astra, Swando said the company would launch the diesel version of the Astra by the third quarter of this year. This car will be priced slightly higher than the petrol version of Opel Astra, though technically there will be no other changes.

The company also announced its plans to roll out a 1998 World Cup special edition model of the Opel Astra on the Indian roads by the end of May 1998. The company will be manufacture only 300 units of this special edition car, which will carry the France World Cup badge. To be sold at a premium, the special cars are aimed capturing the excitement of the World Cup which is scheduled to be held in June-July 1998.

The World Cup specials will be available in two exclusive colours -- Calypso green and Silmeese biege -- and will have a new grill, bonnet, fog lamps, alloy wheels, CD changer, and exclusive World Cup trims as an additional feature to the existing Opel Astra model.

General Motors has also lined up the Opel Vectra (petrol) [above left] and the Opel Frontera (diesel) [above right] for India. The Vectra (1998 cc, 136 bhp engine) will be placed above the Astra while the Frontera, a sports utility vehicle in the European market, will be launched in India as a light commercial vehicle with some modifications. But both these vehicles will be come in only after the Corsa is introduced.

Daewoo to source diesel engine from Renault

Korean car major Daewoo Motor Corp will source its diesel engines from Renault of France. These engines will also be used for the vehicles being manufactured in India. As per the Daewoo agreement with the French company, the Korean company is planning to source three kinds of engines from Renault.

One or two of these will be used in the vehicles that will roll out from Daewoo Motors India Limited. The diesel engines will also be used in the company's range of buses and multi-ultility vehicles that are to be introduced in India, and may also be fitted on to the new cars lined up for India -- the Nubira and the Leganza.

The official, however, said the Renault engines will not be fitted on to the d'Arts, the small car. D'Arts is expected to roll out from its Indian subsidiary towards the end of 1998.

Industry experts have termed the move significant and strategic. Daewoo's competitor, Hyundai Motors of Korea, already has an alliance with Automobile Peugeot of France for sourcing its diesel engines.

As per the Hyundai-Peugeot agreement, the French company will supply its TUDS diesel engine to Hyundai, which the latter will be fit on to the car that will succeed its present Accent model. Hyundai's new model is expected to be ready for launch in the second half of next year, and is likely to be introduced in Korea and India simultaneously.

In another development, Daewoo has lined up another small car for India -- the Matiz, a 796 cc car -- for launch by the last quarter of 2000 AD. The Matiz is a slick vehicle with a front McPurasch strut and a collapsible steering wheel, besides incorporating a single wiper, electric power, and an HVAC air-condition hatch.

According to a Daewoo official, the management will take a final decision on the Matiz in India after seeing the response to the d'Arts. "If the response is encouraging, then we will definitely go ahead with the Matiz," he added.

Daewoo is expected to post a lower turnover in the current fiscal. According to company sources, the turnover in 1997-98 is expected to go down to Rs 8 billion compared to Rs 9 billion in 1996-97. The expected fall in turnover is attributed to the slump in the luxury car segment. The sluggish demand growth in the Indian passenger car market is also expected to upset the company's ambitions to touch Rs 100 billion in turnover by the turn of the century.

Tell us what you think of this report