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With Hector setting the pace, MG Motor aims for the sky

Murali Gopalan | Updated on March 05, 2020 Published on March 05, 2020

Rajeev Chaba, President and Managing Director of MG Motor India   -  PTI

India chief Rajeev Chaba says the Chinese-owned British brand is going flat out

The coronavirus epidemic has ensured that China is constantly in the news, with car sales virtually haemorrhaging as a result.

Yet, one of its top brands, SAIC Motor Corp, will have reasons to feel pleased with its showing in India so far. Having debuted under the MG Motor umbrella, its first product, Hector, has caught the fancy of the market. Likewise, the ZS EV that followed got nearly 3,000 bookings, which is quite impressive in a market that has not quite taken to electric vehicles in a big way.

Rajeev Chaba, President and Managing Director of MG Motor India, grins broadly when asked if he anticipated such a heady response to his company’s products. “I would say that it has not surprised us even while it has definitely exceeded expectations,” he says.

According to him, MG Motor has been “very careful” in trying to answer “each and every question” posed in the Indian automotive landscape. A General Motors veteran who is quite familiar with this part of the world, Chaba says he was aware of the “question paper” given that “we have got experience in India and know what is required here”.

Despite this, the tough aspect was executing the strategy simply because “there is no a,b,c,d formula” in order to be successful. “In my view, product is not everything. It is about how you establish the culture of the company, the kind of teams you make and the dealer body,” says Chaba.

Right perception

Creating the right perception about the product/brand and the total cost of ownership is also important in this India journey. “All these are very heavy elements and there is no short-cut to any of them,” he stresses.

As he explains, it is not as if “you can create culture tomorrow, get good teams tomorrow, get dealers tomorrow…it has to be a carefully crafted approach”. This is what prompts Chaba to confidently state that his team at MG Motor is the best in the industry, as also its dealers, in terms of capabilities, skill sets and alignment to the overall vision.

Beyond this is the breathless pace of work right from readying the Gujarat plant to launching products in barely no time at all. The Hector SUV and the ZS EV were out in record time while the six-seater Hector Plus is next in line. The Gloster SUV, displayed at the recently held Delhi Auto Expo, will be launched during Diwali.

“Speed is of the essence and I am glad that the first two products have exceeded expectations. In particular, the EV is something that I am happy about since many people wondered why we were doing this at this point in time,” recalls Chaba.

From SAIC’s point of view, the objective was about showcasing technology more than targeting volumes. “For the EV, we got 2,800 bookings, which is more than the whole EV market of last year,” he says.

Compelling package

Clearly, this unexpected response was in large part due to the success of the Hector, since brands play a part in establishing technological superiority. More than that, reasons Chaba, customers had read about the product and were aware that it was globally successful. Additionally, its range and size made for a compelling package.

“There are people out there who are ready to experiment. Globally, buyers are moving in this (electric) direction, thanks to issues on climate, environment and so on. We planned this two years ago and things are falling in place nicely,” he adds.

The two cities that have responded extra favourably are Bengaluru and Hyderabad, which account for 35 per cent of the bookings. MG Motor now needs to decide in the next two months about expanding the ZS EV to other cities such as Chennai. Puducherry is also upbeat about the vehicle while corporates are queuing up, too, since some of them want to showcase the green message.

“We have invested substantially…it is not tokenism or lip service where we want to showcase our technology and launch EVs for the heck of it,” clarifies Chaba. As part of the exercise, tie-ups have also been forged with other players in the ecosystem to help iron with issues such as reuse of batteries and rural electrification.

British brand

Chaba is categorical that the Chinese ownership has by no means impacted customer perception about the brand, which is essentially British. As he reminds you, when MG was owned by BMW, it was not perceived as a German brand but British.

“Now it is owned by the Chinese, which we are happy with because they have the resources. They also have EV technology, connected technology, shared mobility technology, fuel cells etc. We can bring all that at affordable prices into any segment we want. To me, that is what the story is,” he declares.

To that extent, the other Chinese players entering the Indian market, like Great Wall Motors and Changan, may not have that advantage and it will be interesting to see what they offer in a market which has remained the domain of Maruti Suzuki and Hyundai for decades now.

“For us, it is the whole story about the brand, people and so on. We want to establish this company as a good MNC with the best practices of Indian, Chinese, American or whatever,” says Chaba. From his point of view, this is how the company is establishing the brand and the fact that people are buying into this proposition is evident from the numbers generated so far.

SAIC had planned an India entry with General Motors nearly a decade ago, when the Lehman crisis had flattened the world. Detroit was in a shambles, too, and GM reached out to its Chinese ally for help.

While the JV did not quite live up to expectations, this first outing for SAIC was clearly a good learning experience. The inputs gathered helped plot its second innings, where it ended up buying the GM plant in Gujarat and take the story forward with a brand new identity in the form of MG.

Second plant

“If everything goes well, we will run out of capacity at the existing plant by end-2021 and go in for a second plant. We are talking to various State governments,” says Chaba. According to industry sources, Andhra Pradesh is a prime candidate though no decision has been made so far.

There are more things planned on the plate. “We definitely need to increase our local engineering capabilities, too. Can we do engineering for some other global operations? The answer is yes because Indian engineering is known for that, but right now we have not finalised anything. Success brings ideas and opportunities,” adds Chaba.

For now, he has no reasons to complain considering that the SAIC journey in India has begun on the right note with a lot more to follow in the coming years. Yet, Chaba insists that it is important to take one thing at a time even while constantly staying aggressive.

“The moment we deviate from the fundamentals or think we have done a great job, we will stumble. This is an ongoing journey where you need to be on your toes all the time. We are not celebrating or declaring victory yet,” he says.

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Published on March 05, 2020
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