Morris Garages (MG) Motor, the iconic British brand, now part of Chinese automaker SAIC Motor Corporation, has finally set foot in India. On Monday, the company announced plans to invest ₹3,000 crore over the next few years.
It will launch its first product, an SUV (most likely a similar platform to globally sold models ZS or GS), next year, followed by a new product each year. The company also plans to launch electric cars in future, depending on the demand and infrastructure in the country.
In an interview with BusinessLine , Rajeev Chaba, President and Managing Director, MG Motor India, shared more on the future plans. Excerpts:
Do you think you are entering the market at the right time — when a lot of policies and regulations are being updated?
It is the right time to come here and our first product will be an SUV. At this point in time it is slightly premature to talk about which segment. What we are clear about is that we will launch one product every year in the six years subsequent to 2019. We are mindful of dealer viability and customer experience and we need to make sure that there is a balance between the two. In the five-six-year time horizon, we will have four-five good products and a clear-cut target positioning to consumers.
Would these products include electric vehicles?
Electric vehicles right now need detailing to be done — with policy, regulations, incentives, consumer education and infrastructure such as battery issues. The government has made its intention very clear and the good news is that SAIC has got the technology and products in that area. We are doing our homework, but it is difficult for us to make any announcement right now. Hopefully, in the next few months, we will be ready after talking to various stakeholders.
Being a part of a Chinese manufacturer, do you see hurdles in convincing customers?
Our brand is MG, which is an iconic British brand. Ownership happens to be SAIC and we are very proud of that.
There are many examples of brands owned by some other nationality. We will have the MG DNA in our products and ultimately it will be heavily localised, produced by Indians in the Halol factory. Consumers in India are looking for a compelling and meaningful value proposition from any brand and there are many cases in India where successful brands have flop products and not so well-known companies have successful products. Ultimately, consumers have to decide after seeing the product. What we are quite confident of is the fact that the product we are going to launch will be quite compelling. It is going to have some class leading features and are going to offer good value — not only in the initial stage of ownership, but also subsequently, in the cost of ownership post sales, including the resale price.
How about your Japanese or Korean competitors?
MG is a global brand and the global aspiration of SAIC will be met. They are getting aggressive in India now and also in West Asia and Africa. All our suppliers are nationally/globally competitive. SAIC is exporting a lot of products to countries like the US, Germany and many other developed countries. So the platform we put here is more important. We are trying to have a good chemistry with consumers and other stakeholders like dealers and vendors, and in terms of some design cues of MG — like the lamps.
Are your suppliers the same as that of GM India?
We do not have any such benchmark with GM. We are looking at the best suppliers available in the country, the best engineering talents and the best dealerships. So we are going to select the suppliers/dealers based on merit and if some of them happen to be ex-GM, so be it.
Haven’t some of them approached you?
We are going to start our dealership tour in a few weeks. Already around 200 dealers have registered as perspective partners. After the completion of the dealer experience show, we will go through the selection process.
How about the ex-employees of the Halol plant?
We have set criteria for any position. When we took the plant (from GM), it was just the assets of the plant without a single employee. So, When we started the recruitment process, some of the ex-GM employees happened to be selected — I am one of them. We are close to 150 people now. With the planned investment over the next five-six years, we may have more than 4,000 people. But right now, in phase one, we will have around 2,000 people.
What would be the strategy for this plant…would it be only domestic or export oriented too?
We will take one step at a time. Obviously we will be focusing only on domestic and neighbouring markets initially. But some of the right-hand markets can be within the approach of SAIC. But we have not finalised that. Right now, we are making sure we have the right foundation for the domestic operation. Over the five-six years horizon, we will be targeting two-lakh units a year, but in phase one, we are looking anywhere between 80,000 and 1 lakh capacity a year.
You have been tying up with lot of start-ups, so would there be anything made by them in your products?
Our intention is to make sure that there is the right chemistry with the communities we operate in, encouraging and hand-holding entrepreneurs in the automotive field. We had short-listed 60 start-ups and we are actively engaged with 8-10 of them. We are seeing all forms of collaboration — be it doing test pilots, making available our future products to them or may be some after-sale solutions or even investments. Nothing can be ruled out right now. It will evolve as we go forward, but the whole idea is that being a part of the OEM community, we need to encourage innovation and hand-hold the young generation, and encourage the entrepreneurial spirit. So that’s the idea, but how it ends up we also don’t have any idea. But we are open to any kind of experience.