The Hindu Business Line : Increasing competition — GM pegs Vectra, Forester sales at 2003 level

"There is too much competition in their respective segments because of newer models being launched frequently," the General Motors Vice-President, Mr P. Balendran, told Business Line.

Mr Balendran said even though Opel Vectra and Chevrolet Forester have performed extremely well since their launch and give better value for money, they compete with too many models in each of the segment both these cars operate in.

Vectra competes with Toyota's Camry, Ford's Mondeo and Honda's Accord in the premium segment. Chevrolet Forester competes with Honda CR-V and Ford Endeavour in the sports utility segment.

While Vectra is priced at around Rs 17 lakh, Camry is priced slightly higher at around Rs 18.5 lakh, while Ford Mondeo is priced at around Rs 17 lakh - Rs 18.5 lakh. Honda Accord is priced around Rs 15.5 lakh and the automatic version at around Rs 16 lakh. Interestingly, Vectra sold a total of 461 cars during 2003 compared with over 1, 000 units of Toyota Camry and Honda Accord each. Camry already has a 20 per cent share of the premium segment.

But Mr Balendran said the Vectra's sales target for 2004 would be similar to that of 2003 and there are no plans to bring in more variants of the car. "With a large number of players operating in this segment, most manufacturers like us are keeping realistic targets and focussing on direct marketing efforts rather than going for mass advertising," he said. Mr Balendran said the Opel Vectra programme, being a completely imported unit, is aligned to the international programme. "This per force means that we have comparatively lesser flexibility in terms of variants or pricing. We have similar targets for the year 2004 as well," he said.

Chevrolet Forester priced at around Rs 13 lakh sold 178 units since its launch early last year. Honda CR-V priced at around Rs 15.4 lakh and Ford Endeavour priced at around Rs 13 lakh received good initial response just as Forester did when it was launched. Even the sales target for Honda CR-V and Ford Endeavour are not ambitious enough because the SUV market in India is yet to take off. Mr Balendran said the sales target for Forester is similar to that of 2003. "We have similar targets for the year 2004 as well. The SUV market is in a nascent stage in India and would hold great promise in the coming years," he said.

Mr Balendran said the company has targeted sales of 50,000 units of its various models by 2005 and, hence, is ramping up its capacity accordingly at its plant in Halol.