Interview with Mr. R. Ramakrishnan, Senior Vice President, Product Strategy & Planning and Customer Value Creation, CVBU, Tata Motors
What would you attribute the Magic’s success to? What more can we expect from the popular last-mile transport brand?
For a populous country like India it makes tremendous sense to have a comfortable, safe and, at the same time, low-cost transport option. The Tata Magic provides a safe all-weather transport for the driver and the passengers. It offers the unemployed people a value proposition to earn a livelihood and allows the authorities to provide a safe and comfortable transport option for the public.
There are around 300 districts in India which have provided a permit for these vehicles to ply. However, there is lot more to be done because the vehicles are given a contract carriage permit in most places, meaning they can ply from point A to B but cannot pick and drop people on the way, which is essential for last-mile transport. If the right permit is not provided, the fundamental purpose of the vehicle is lost.
There are districts in some States, including Rajasthan, Madhya Pradesh and West Bengal, where these vehicles are given a stage carriage permit which allows them to pick and drop passengers en route. This has unlocked the real potential of the Magic family and has even wiped out three-wheelers in some areas.
We have been appealing to the transport authorities, explaining how the right permit can benefit both the passengers and the transporters. In regions where the authorities have understood the cause and responded, things have taken good shape.
Why is there resistance from authorities in providing the right permit?
In some areas, the authorities feel these vehicles could lead to a conflict of interest with State transport buses while in some cases it is about the three-wheeler operators getting affected. The actual purpose of these vehicles is to bridge the gap in areas which are not well connected by buses, so if they are given a stage carriage permit to operate in designated routes and stops, the operators can run them viably without any conflict of interest.
What about using the Magic for intra-city operations?
The Magic Iris can easily handle intra-city operations. It offers better operating economics and is safer and more eco-friendly than three-wheelers. Overall, it provides passengers a very good option for travelling within the city.
What fuel variants do you currently offer in the Magic family? When do you see hybrid and electric versions becoming practically viable?
The Magic is currently available in BS III, BS IV and CNG variants. It meets the emission standards of passenger cars – the M1 standard, and offers better fuel efficiency which in turn means cleaner air around the vehicle.
Hybrids and electrics are still some distance away before they can become commercially viable. The Government is encouraging alternate fuels in the form of hybrid and electric vehicles, and while we are ready with the required technology, we believe it will take considerable time for them to become viable. The main challenge is largely due to the huge acquisition cost of these vehicles which makes it practically unviable to ply them, especially at the current rates which customers and passengers are ready to pay for buying and using the vehicle respectively.
Being a market leader in the SCV passenger segment, how do you plan to maintain your position given the fact that competition is growing in this space?
For the first few years since its launch, the Magic had around 70 per cent market share in the SCV category. The model went through a major facelift on the interiors and exteriors, apart from other refinements a year ago, following which our share has gone up to nearly 85 per cent.
We will soon be launching a higher powered version of the Magic called the Magic Mantra to cater to customers who want to cover longer distances and scale gradients. It will have a powertrain similar to that of the Ace Mega, with a 40 hp engine. Going forward, our strategy is to work with the authorities and help them understand how the right permit would help all stakeholders. We also plan to work with the financiers to help support transporters for a better enablement of the whole concept of last-mile transport.
Lastly, with road infrastructure getting better, we are working on expanding our presence in rural markets. Whenever a rural area gets connected to a larger town or city, we have seen a rise in economic activity in the region, and we feel vehicles like the Magic can provide a very good solution in such areas.