Indian Autos blog

An event that should have happened a long time back is finally complete. Fiat India has separated from Tata Motors for their solo journey in India. But speculations are rife that Fiat ended the deal because it wanted to take the relationship with Suzuki to the next level.

How does Fiat India benefit?

Fiat India, despite of being in India for donkeys years, does not have a strong standing in the Indian market. If it wasn’t for the Multijet engine, the company could have gone belly up a long time back. So an increased alliance with Suzuki, which currently accounts for 42 percent of the Indian market, would benefit Fiat in terms of establishing dealer network and expertise in the region.

The Suzuki Grand Vitara may not be the most popular car in India. But just a like baddie in a Rajnikanth movie, it refuses to die. Been in existence since 2005, the Grand Vitara has just got an update at the Canadian Auto expo. When we say ‘update’, what we really mean is some minor changes to the tail.

And by minor changes we mean, Suzuki has replaced the full-sized spare tire for a temporary donut spare and placed it underneath the floor of the cargo area. That’s it!

Since the VW- Suzuki partnership has been on the rocks for quite sometime, there were rumors about the possible break up between VW and Suzuki. However Reuters has confirmed that the partnership is still going strong and there are no plans of parting ways.

The two car companies joined hands together in 2009 when VW bought 19.9% stake in Suzuki. There many talks about how the Japanese counterpart can help VW establish a strong presence in the small car market. The partnership was especially beneficial for India because Maruti Suzuki knows the market dynamics like the back of their hand. VW, a relatively new entrant, would have benefited immensely with that knowledge.

However, since the last 3-4 months, there has been a media war between the two companies. VW went on wires to confirm that they were not getting enough co-operation from the Japanese counterpart. In return, Suzuki’s head honcho made a blogpost that VW was not giving due respect to Suzuki and the two groups needed to go back to the drawing board on their partnership. Suzuki did not want to be viewed as a group company of Volkswagen and reports of a rejig in the stake-holding pattern also came to the surface.

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Volkswagen recently bought 19.9% stakes in Suzuki. The German carmaker made a very smart move by buying stakes in Suzuki could create opportunities for VW to jointly develop low cost car models, which is the Japanese marque’s strength.

Volkswagen is planning to develop its next generation of small cars and compact crossovers/SUVs with Suzuki as the latter is best known for its frugal engineering and packaging. Volkswagen’s joint venture with Suzuki could help both the brands and also VW’s sub-brands, Skoda and Seat.

Volkswagen’s small car UP which is expected to be a very low cost city commuter, is already being developed and at this stage VW could do with Suzuki’s know-how on cost effective packaging and low cost manufacturing techniques. The next gen Alto could be based on the VW UP but that would definitely not come to India.

What we feel is that, this would pay Volkswagen huge dividends in India where Suzuki has a strong presence and the VW small car could be made by Suzuki and hence guaranteeing its success in India.

Other Suzuki models Volkswagen would be interested in, are the SX4 and the Grand Vitara. The next generation Suzuki SX4 could be used by VW to develop a small crossover which could be used by Volkswagen for the next gen VW Tiguan and Crosspolo, the Audi Q1, the Skoda Yeti successor and the Seat Tribu.

The next generation Grand Vitara could be jointly developed by both the companies and this could form the base for the Volkswagen SUV that could fill the gap between the Tiguan and the Touareg. This could be a Passat SUV and is dubbed the VW416. This platform could also be utilized for the Audi Q3 mini SUV and the upcoming Skoda Bigfoot.

Except for next gen Alto that could be based on the Volkswagen UP, the other cars that are mentioned above would come to India, if the joint-development exercise goes well.

Possible products that could jointly be developed by VW & Suzuki -

> Volkswagen UP – Next gen Suzuki Alto (only for Europe)

> Next gen Suzuki SX4 Crossover – next gen Volkswagen Tiguan – Audi Q1 – Skoda Yeti next gen

> Next gen Suzuki Grand Vitara – Volkswagen Passat SUV – Audi Q3 – Skoda Bigfoot

Suzuki Every – Air con problems could cause fire

Barely few days after IAB remarked that more recalls are expected (Read – Now Hyundai recall the Sonata in US and Korea), the industry appears to be proving us right.

If you look at the faults that we have seen over these recalls, a majority of them are to do with systems or designs that have become complex with technology advancement or generations.

This raises three questions -

A/ Are testing methods for new technologies and mechanical designs insufficient? Is it a case of car makers compromising on passenger safety in a race to introduce new technology and designs in the market?

B/ Are existing safety/ testing regulations inadequate? We know of the stringent crash tests (like Euro NCAP, incidentally this rewards cars that employ electronic stability control and speed control) but what about technologies like the air con and steering systems? Is it time to create a regulation on these designs?

C/ Can mechanical designs and technologies such as Airbags, ABS, ESP etc be standardized? Take F1 for example. The McLaren ECU is standardized for all teams. This helps F1 and FIA regulate all cars. In my opinion standardization is the way to the future. It reduces development and testing costs. All manufacturers can then compete on the actual competitive factors of automobiles (i.e Product design, engine performance and value proposition).Just a thought to car makers.

If you were an automaker and you had grand plans for India, which auto manufacturer would you look to partner with?

The answer is the obvious. And VW also agrees.

Rumors of a possible tie-up between VW and Suzuki were confirmed by a popular German publication which has quoted an unnamed Suzuki official. The report goes on to say Suzuki will have access to VW’s technology in exchange for Suzuki’s resources in India and other South East Asian markets which will enable it to get a good start.

Suzuki Official -

“For Suzuki and VW this connection would be a win-win situation. Suzuki would have access to a variety of VW’s technology, while Volkswagen would have a solid supporting leg in India and Southeast Asia.”

Suzuki Motorcycle India will launch an entry-level motorcycle in the next fiscal year.

Entry-level motorcycles are those with engine capacities more than 75 cc and less than 125 cc. Even a layman knows this segment is dictated by Hero Honda, who has 80% of the pie in its lunch box.

In the next fiscal, Suzuki will also import completely built units (CBUs) of its 1,000 cc GSX-R model encouraged by the success of the Hayabusa and Intruder, which cost Rs 12.5 lakhs each, and together sold about 100 units since their launch 8 months ago.

Thanks to its expertise in small cars, Suzuki has been the second largest car maker in Japan and its subsidiary Maruti Suzuki has a 54 % market share in India.

Tata Motors’ Nano priced at around $3,500 has also provoked great interest across the globe. Car makers are following the footsteps of the Indian car maker in making something similar.