Everyone remembers the failure of Renault in India with the local partner Mahindra. It Hurts. Yes, it does.
Far from the industrial might of France along with design inspirations from its neighbor Italy, French automobile giants like Renault have had it very difficult here in India. Without blaming the hot weather here, I get down to identifying some of the key reasons for this mis-adventure!
First, the economic situation. Yes, we should all blame our problems to the global recession. The partnership with Mahindra was created in 2005, the commercialization of Logan began in 2007, just before the crisis of 2008. Of course, like everywhere in the world, India has been affected. But the Indian auto market has been quickly recovered (thanks to surge in domestic demand) whereas the Logan saw its sales fall by 68% over the same period 2009. Maybe the Indian market never placed its love in the French car, especially after their wallets felt the pinch.
The Logan did suffer from a tax measure taken by the Indian government in 2008. This new measure penalizes vehicles over 4 m long by subjecting them to a tax of 24%. The Logan, which measures 4.25 m, has seen its price explode. As a result, the Logan became too expensive to position itself among the low cost cars and too small to claim to rival the vehicle of a higher standard – the beloved place in the Indian market was hard to find.
Finally, in 2008, Tata and Maruti launched the Indigo CS and Swift Dezire respectively. I am not implying that Logan exists in the same competing space but since the Indian market is made up significantly of compact models, pricing does hold a key. Expectations rose and people couldn’t find real value for a Logan with its price tag. Coupled with some nagging issues like quality of headlights, position of light controls etc, it struggled to find a position.
Apart from these, aesthetic aspects did not struck the right codes with Indians who have been pampered by Hyundai for quite some time now. Logan failed to account for modernity and luxury (something which was expected due to its French connection). The fact that it was originally designed only for the Eastern European markets further added to the fall. It was not entirely representative of the image of France for the Indian market.
All in all, it seems that Logan was not ideally suited to the Indian market. Expecting to ride on its success in the emerging Eastern European markets was a risky decision which felt flat in Incredible India. Maybe, much more efforts in Indian-izing the car, its interiors as well as marketing is the need of the hour for all foreign companies.
Mehdi is an avid car enthusiast travelling across India writing his thoughts on Indian Automotive Industry.