Woes at Hindustan Motors

Way back in 1998 Mitsubishi Lancer was the epitome of Luxury in Indian cars. Nice engine, superb build quality and those killer looks sold cars off the showroom floors without hassle. HM was happy, so happy they decided to go to sleep. Come 2010, Honda City, Mitsubishi's closest competitor is selling close to 3000 cars a month while HM managed Lancer and Lancer Cedia together hardly make 1% of that number. There were a lot of reasons HM has failed since the advent of Maruti in the 80's. But this post is not about the woes HM is facing. The media I am sure will kill a dying company much before its time by doing that. It is about what HM should do since Ravi Santhanam is not at the helm anymore.

Assets
HM has three major assets. A Brand name that has strong sentimental patriotic values by meaning and by its car making history. Secondly they have two car platforms at hand which are cheap to build and can be repaired just about anywhere with easy availability of Spares (A major reason why most people buy Maruti's today). Thirdly HM has the technical know how from making HM's own branded cars, Mitsubishi cars and outsourcing services for some major companies. Additionally, The Company also has sentimental values thanks to the Hindustan Ambassador's long lasting roots.

What I would do
1. Bring back the HM Contessa refresh model: I don’t know how many Indians are aware that the quickest car in the world is based on a Contessa. :D Even if the world knows, I am sure HM doesn't. Muscle cars are what brought Ford GM and Chrysler back from the dead. It was the Mustang, Camaro and Challenger that gave these American companies a new face. The Contessa reeks of American Muscle cars and that is not a bad thing. Many a discussion groups have tons of people filling hundreds of pages with dreams of converting a Contessa into a muscle car. Hindustan Contessa was a luxury segment car for HM. A segment in which you get the Civic, Cruze, Corolla, Octavia and similar cars today. The last batch of Contessa cars were sold at around 5 lacs. HM has the plant idle and the dye and machinery at Hand. A refreshed Interior designing might costs a bomb but what would giving at a retro look with good quality parts cost? The initial batch will only be a branding exercise to bring attention back to the oldest car maker (which again is an asset from HM).



The list of upgrades needed (assuming they sell a modest 3000 cars in a year)

1. A climate control unit. Most Contessa and Ambassadors have had after market units attached to the dash. A neat job for the same with a climate control unit will be affordable as well as a boon.

2. 16 inch alloys. Some work might be needed with the chassis and suspension as weak suspension has often been cited as the drawback.

3. Redesigned Headlamps. Mr. Manvendra, who worked for Ambassador Avigo can provide a similar update for the Contessa.

4. The same Isuzu petrol unit tuned to give good fuel efficiency will work along with a diesel engine sourced from Ford or Renault. (Both have a 1.4 diesel in their cars in India which best known for their fuel efficiency). HM also has a good tie with Ford. Do the math. Additionally while the engine are not as powerful as the rest of the segment. Look at what Fiat has done with the Linea.

5. A premium audio system with Bluetooth, USB and other knick knacks.

6. Lift the Outside rear view mirrors from the lancer 1.5 parts bin and utilize it on the Contessa.

7. Add ABS with EBD and 2 airbags which are par a segment standard.

8. Provide the car with an add-on RPM meter as the dash doesn’t have one. Ritz and A-star have such tachometers and it looks cool.

9. Since it is a big car, work on the gear ratios to make it more drivable in the city while giving better fuel efficiency.

10. Add stereo controls on the steering wheel to make up for the lack of old interiors.

11. Add fog lamps and rear stop light. Also add a shaker to the hood.

12. Advertise

13. Advertise

14. Advertise.

For a car that was being sold for about 5 lacs. A price tag of 10 lacs is easily justifiable with the upgrades mentioned above along with other minor upgrades still leaving the company with enough room for a fat margin.

2. Introduce an Ambassador hatch: The Beetle has an age old design; the Mini Cooper has been selling for decades. I am sure a properly redesigned small car based on Ambassador will also bring in sales for HM. A length below 4 meters mark along with 1.2 petrol and 1.4 diesel engines and CNG LPG options (all except the petrol engine already available) will make the car even cheaper to sell against the competition. Since the spares are already available for the Ambassador and since it can be repaired anywhere while giving good FE at the same time, there is no reason why a well built Amby hatch won’t sell. The car is also known for robustness and comfort. A rough calculation puts a monthly sale figure at 1000 units if sold at 5-6 lacs.

3. Redesign the Ambassador: The Above two steps should bring in enough finances and a stronger dealer network to redesign the Ambassador grounds up making it equally competitive with the likes of Indigo Manza and Swift Dzire. Using the same engines on all the three cars will further help bring costs down and increase margins while making spares availability easy.

4. Improve the quality to meed European standards and begin exporting cars.

Looking at how shrewd and intelligent the Birlas are, the current state of affairs at HM is a plain shame. The nameplate bears the name of the country and the condition reminds us of the baburaj of Bengal in the 60's and 70's. If GM can rise from Bankruptcy, I am sure HM can do the same too.

Singing off with some nice concept cars based on Ambassador cars with similar history and looks.

Hindustan Motors (HM) Ambierod designed by Dilip Chabbaria (DC Designs)

HM Ambassador Avigo

BMW owned MINI Cooper. Look at the resemblance

Another iconic European car (the beetle). Ambassador is also a European car by roots.

PS: HM has finally decided to do up the Amby with the help of European Design studio.  Looks like someone's been reading my blog. :) Hope they implement the plan completely and do a Royal Enfield kind of turnaround which is not selling like hot cakes thanks to Siddharth Lal. And maybe peugeot can help them as well with R&D and engines.

Indian cars in 2012 you never knew existed

Markets have opened up in India in the last decade and luxury cars have come flying in. Customer flock the showrooms of even Nissan and Volkswagen nowadays. But, if on a normal day you are asked to name 5 Indian car companies / Indian Car brands/ India car manufacturers. you will stop at 2 or maybe three at best and car reviews and comparison of these cars are not available either. So here's some information of the cars makers of India who are alive and kicking.

1. http://www.tatamotors.com/
Tata Motors: Ok, you know about Tata. They made Indians proud with the Nano and purchase of JLR. The new Indica Vista and Indigo Manaza are not built good enough to stand with the best in business. The Grande and Safari still look good and show Tata's UV past. Tata has evolved into one strong car maker and with a JV with Fiat in place and Jaguar Land Rover acquisition, things are just looking better.

Cars on offer

Tata nano
Tata Indica V2
Tata Indica Vista
Tata Indigo CS
Tata Indigo Marina
Tata Indigo XL
Tata Indigo Manza
Tata Safari
Tata Sumo
Tata Grande MKII
Tata TL 4X4 pickup
Tata Xenon 4X4 pickup
Tata Aria
Tata Venture

My pick: Tata Xenon 4X4, Tata Manza, Tata Aria
Suggestion: bring in automatic transmissions for your cars.

2. http://www.mahindra.com/index.asp
Mahindra&Mahindra: Who doesnt know mahindra? The maker of the classic Jeep (FYI Jeep is a brand in itself owned by Chrysler USA now a part of Fiat and Government of USA :P). The scorpio changed the way the world looked at Mahindra. The xylo was another shot in the arm and Mahindra is suddenly the uber cool brand from who doesnt hail from the village anymore. A failed marraige with Renault brought in the Logan but otherwise Mahindra is yet to get a Sedan in its lineup. Until then Mahindra will make do with 'largest selling UV' tag for it's Bolero.

cars on offer.

Mahindra Renault Logan / Verito
Mahindra Thar
Mahindra Scorpio
Mahindra Getaway
Mahindra Xylo
Mahindra Bolero
Mahindra Bolero Camper
Maini Reva

My Picks: Mahindra Thar, Mahindra XUV500, Mahinra Logan Verito Diesel.
Suggestion: Where are the sedans and Hatches? Start with a hatch.

3. http://www.icml.co.in/
ICML: International Cars and Motors Limited is one of the latest entrants on the Indian Automobile scene. The Rhino has done well but not well enough to justify the launch of the small car ICML has waiting in the wings. The makers of the Sonalika Tractors are still going strong with building a widespraed dealer network. The cars are improving regularly and so are the engines. The Rhino like all other Indian cars had handling issues and received tuition from Lotus UK and now with Rover's new engine is ready to sell.

cars on offer

ICML Rhino
ICML Inspire (waiting for release)

My pick: Icml Rhino TCDI.
My suggestion: Bring in the Inspire fast.

4. http://www.premier.co.in/wb/
Premier: Remember the Padmini's? The Maharashtra based maker of Padmini's and 118NE is back and how. With support from the Chinese, I am not really that impressed but Premier has chosen a good car and platform to begin with. The rio is a nice car and more cars are on paper. Fit and finish is not its forte but VFM and utility are. For a small car buyer looking for a small SUV looks, look no further.

Cars on offer

Premier RIO
Premier Sigma

My pick: Premier Rio
Suggestion: Provide service and spares for Padmini's. It will earn you money and reputation. A small sedan will be a nice addition considering the financial muscle permits.

5. http://www.forcemotors.com
Force Motors: Not well known by their current name but many will jump if I say Tempo, Trax or Bajaj. The company has gone through numerous name changes it seems but the models are yet to see revisions. A new SUV based on license from Daimler Benz, the Force ONE has just been launched. Excellent off-roaders.

cars on offer.

Force One
Trax Gama
Trax Gurkha

My pick: Force One
Suggestion: For starters please update the cars with better quality interiors and some kit.

6. http://www.hindmotor.com/
Hindustan Motors: Once the GM of India, HM was the largest car maker selling the Ambassador. Contessa came and went much before its time. What followed was a timewarp and HM never brought in a new vehicle. The good side is that the Ambassador car is more customizable that any other model on offer but the flip side is now even the grandpa's dont want one. Even the Collabration with Mitsubishi is lagging.

Cars on offer.

Hindustan Ambassador petrol
Hindustan Ambassador Diesel 2.0
Hindustan Ambassador Diesel 1.5
Hindustan Ambassador CNG

My Pick: None
Suggestion: Refresh the Hindustan Contessa for the luxury market and bring in an ambassador hatch. If funds are tight Position the Ambassador for the taxi market correctly.

7. http://www.sanmotors.com/
San Motors: It hardly is a car company in operation. Nobody knows if they sell anymore or not, but the website is still up and so is the contact info. While plans were to make 3 cars, only one had come up for sale years ago. Never seen another in 5 years. Just a paper dream nowadays.

Cars on offer

San Storm

My pick: Uhmmm. Pass
Suggestion: Plonk a turbo, add better body panels with good finish and relaunch at the same price tag.

Homegrown bike makers and their marketing skills

I've lots of respect for Domestic 2-wheeler majors Bajaj and TVS. They have coped on quality and innovation fronts better than Mahindra and TATA in 4-wheeler market. Here are some nice commercials from them that I like.

Some Lee Iacocca Quotes

Lee Iacocca is a name which Ford and Chrysler will never be able to forget. He saved one from bankruptcy and put another on the world stage in the process. I wonder why he doesnt come public and buy Hummer to make profitable while saving jobs at the same time. For those who don't know him, here are two links.

1. http://en.wikipedia.org/wiki/Lee_Iacocca
2. www.leeiacocca.com/
 Here are some quotes from him I find interesting.

1. One of the things the government can't do is run anything. The only things our government runs are the post office and the railroads, and both of them are bankrupt.

2. Apply yourself. Get all the education you can, but then, by God, do something. Don't just stand there, make it happen.

3. Every business and every product has risks. You can't get around it.

4. I have found that being honest is the best technique I can use. Right up front, tell people what you're trying to accomplish and what you're willing to sacrifice to accomplish it.

5. I hire people brighter than me and then I get out of their way.


6. If a guy is over 25 percent jerk, he's in trouble. And Henry was 95 percent.


7. If you want to make good use of your time, you've got to know what's most important and then give it all you've got.


8. In the end, all business operations can be reduced to three words: people, product, and profits.
 
9. My father always used to say that when you die, if you've got five real friends, then you've had a great life.


10. The most successful businessman is the man who holds onto the old just as long as it is good, and grabs the new just as soon as it is better.
 
11. We at Chrysler borrow money the old-fashioned way. We pay it back.


12. You can have brilliant ideas, but if you can't get them across, your ideas won't get you anywhere.

Even the non enthusiasts will like it.

Via Hemant AR:

Ah yes, the good ol’ pull-the-tablecloth-off-the-table-without-sending-dishes-flying routine. The oldest trick in the book?


Possibly, but BMW has taken it upon themselves to update the classic demonstration in a major way. How ’bout upping the ante with 24 complete place settings around a giant rectangular table? Yeah, that’d do it.

Just how is BMW planning to remove said tablecloth? Using a new S 1000 RR superbike, that’s how. Will it work? Well, it’s really a question of physics, right?

Take 193 horsepower and a 0 to 60 time that’s just shy of 2.9 seconds. Add in one rider with a quick set of wrists and shake well. Garnish with celebratory wheelie.

We highly recommend that you click past the break to see it all go down on video. It’s very much worth your time.

possibility of MV Hummer?

Mahindra & Mahindra is a classic case in point. BMW and Suzuki have also done it successfully. This brought me to think. Can MV Agusta and Hummer exist and thrive in company?

MV Agusta is a small boutique Italian outfit building limited edition Motorcycles boasting of 150+ horses. In the recent years the company has changed a lot of hands and also sold off its arm 'Husqvarna' to BMW. Without doubt MV would've made a classic fit with Lotus sports cars under Proton of Malaysia. But after foundering with ways to make it successful the company was sold off for a token 1 Euro. All these unsuccessful business decisions are not even the slightest hint to what beautiful bikes the company can make. Hummer on the other hand is an out and out macho and ugly SUV most males would forget about their girlfriends in. The first thing that comes to mind is to drive it over that enemy's BMW. Both the brands are white elephants but need a better owner.

Mahindra is a maker of mini pickups, MUV's and SUV's in India. They coincidentally also have a Humvee twin in production which is also sold to a few armies around the world. Recently Mahindra acquired Kinetic's 2 wheeler business and turned it around in a matter of 2 years. Trucks and 2 wheelers are as different as chalk and cheese but Mahindra has been able to be successful at the lower end of the market. With proper marketing and cost calculations it wouldn't be tough for a potential owner to turn a MV-Hummer joint venture.

A lot does need to be put into considerations such as platform development costs, R&D, Marketing, Profitability and debt repayment. But if Nissan can succeed under Carlos Ghosn, if Ford can evade bankruptcy under Alan Mulally, I am sure A MV-Hummer can survive under someone like Lee Iacocca (Bring him back before it's too late.)

Pssst: If Lamborghini can build the Estoque and if Porsche can build the Panamera, MV-Hummer can build a premium sports sedan too. (A rebadged Pontiac G8 or Solstice anyone?)

The new porsche - reinvention of the hero

Whenever the words Geneva and cars are taken togather, it spells one of those bed wetting dreams for automobile enthusiasts. Why not? Manufacturers with cars like the new Lamborghini Superleggera and a hybrid ferrari are going gung ho about the environment making green people happy.

But one hero stands out amongst all. A car to beat Lamborghinis and Ferraris? you might ask. Yes. The new porsche 918 kills with its looks first and then gets picks you up to its level to enable you to talk face to face. Gorgeous looks and maturity are its forte. If you ever saw a post merger Peugeot Citroen Car, this new Porsche will burn it to ground in envy.  And did anyone mention that it's a hybrid?

While many who live by number crunching on paper figures will start complaining, Porsche has taken an excellent route to keep fans happy. Now how about discountinuing the Chayenne? ( I know its a hit but still.)

Here is the pic.

Good-bye Palio

It would be wrong to say, nobody will shed a tear when the Fiat Palio will die. I for one have always been a die-hard fan since the Palio 1.6 GTX made debut in India. Though expensive at 6+ lacs, it was an excellent value for money at its time. ABS and Airbags were optional but 100 horses were standard. Even cars like Accent and Lancer didnt have that kind of power.

The Palio has seen a lot in its lifespan in india. A high of 2000+ cars a month to a meagre 50-60 cars a month. Talk of style, power and rigidity to issues of Fuel Economy and spares and service issues. But one things was for sure, you may love it, you may hate it but you can never ignore it. The stile was a desperate but failed attempt to relive the car. Not surprisingly since Fiat India decided to do only half the job and didnt touch the interiors (the exteriors were never a point of complaint in the first place.)

Now that BS IV norms are pushing things south and with Fiat Punto taking over the baton from Palio, Fiat has decided to retire the aging workhorse and dedicate the assembly line to Punto. Now a car that once made Sachin proud and made Michael schumacher take notice deserves a small post. Doesnt it?

Hummer and Pontiac need to survive.

Hummer has recently been put up for sale by GM. For GM which has recently come out of bankruptcy, it makes sense on cutting down the brands. It never did know what to do with 10+ brands it jad acquired worldwide in the first place.

Now out of bankruptcy and with the final sale of Saab ( again which needed to survive) GM is now next putting its attention to Hummer. While Saturn cars were nothing but rebadged Opels ( I still love the Sky),  Pontiac and Hummer are two brands which have a place and reason to exist. Pontiac's have always been known for their sporty nature even after GM's marketing genuises tried to ruin the brand image in the recent years. Same goes for Hummer. Hummer's are known worldwide for their Off-roading nature and tough build. One can but only remember the Californian Governer Arnold Schwarznegger (Did I spell that correctly? :P)  And while GM has an Off-roading and Truck making vehicle division in GMC which makes profits, Hummer is an equally strong niche products. While environmental analysts and most automobile companies would say that Hummer cant survive with only 9000 units sold last year, its an excellent case study for lost identity just like SAAB.

IF GMC, LAND  ROVER, JEEP,  Mahindra & Mahindra and FORD Trucks have a reason to live, Hummers have every reason to survive until then.

Yes, Corrections are needed. H2 and H3 need to be significantly revamped to appeal to the masses. Most SUV and truck owners hardly use their vehicles off-road and are supposed to be image builders. Hummers need better designed interiors and befitting engines (read slightly more Fuel-efficient). Also the weight needs to be cut down overall. Introducing a Soft-roader (Hummer HX concept) might go a long way in hitting better sales targets. But I do agree with two points.

1. Significant investment will be needed in the initial phase itself to undo the damage done by Liquidation motors before and Government Motors now.
2. Hummer can't survive by itself. But with a similar case to JLR (Jaguar-Land RoverA), A pontiac-Hummer combination will be a sure winner.

For about 150-200 million in cash (those of your smirking out there need to know that the smallest car companies have that kind of money)  A HummerPontiac Corp. will make utmost sense. For the beginning Pontiac G8 and Pontiac Solstice can be put for sale. The company's operations should be based on limited sales with high premium margins. I wouldn't expect the sales worldwide to touch more than 50,000 in the first year and 100,000 in the second year.  GM should be able to agree to let the company use their platforms and engines for a period of 3-5 years until the car company can build its own platforms and engines.

While Hummer has been saved from the Chinese hands for now (GM is as desperate as the 40 year old virgin) , I hope a significant car maker comes up with the money to save the brand. I am ready to bid and save the plant in South Africa if the government backs me up. :)