An exclusive interview from MOTORINDIA
Tata Motors has recently launched a range of fully-built buses to further expand its presence in the bus segment. With JNNURM II coming up, the company is keen on bagging big orders from STUs. We get an exclusive update on the market leader’s new products and future plans from Mr. Habib Saleh, Head (Sales & Marketing) – Buses & Vans, Commercial Vehicles Business Unit, Tata Motors.
Question: How has the bus business been for Tata Motors during 2012-13? How many units have been sold, and has there been good growth?
Answer: There has been a severe overall slowdown in the commercial vehicles industry, including bus business, the primary reasons being poor investment climate hindering economic growth and fuel price increases leading to dampening of the consumer sentiment. However, even with shrinkage in the industry size by five per cent, Tata Motors has been able to maintain its market share at the same level of 44 per cent and has registered a volume of about 31,000 vehicles during April-January of 2012-13.
Q: Have there been any important initiatives or new launches in the bus segment by Tata Motors in the current year?
A:We at Tata Motors continuously develop new products and upgrade our existing products. We strive to offer the best-in-class vehicles in each segment through technology rich products, offering the best life cycle cost. Similarly in the past year, we have introduced several new buses and upgraded our existing bus platforms to suit the emerging market needs.
Recently we showcased the four new fully-built buses at the SIAM Bus Expo held at Noida – 45-seater luxury MCV coach on LPO 1618 for inter-city transport, 41-seater luxury staff MCV bus on LPO 1512, 36-seater luxury Starbus Ultra on LPO 9.6 / 52 for contract carriage, and 56-seater Starbus Ultra SKOOL on LPO 9.6 / 52 for School application.
This year we have introduced different variants of Starbus Ultra across the country meeting various application needs. This ICV bus range on an LPO platform is a game changer and will revolutionise the travel conditions in India.
In addition, a completely new range of buses – CityRide Ex – has been launched and is available from 16-seater to 49-seater options in BS III & BS IV in standard and school variants. This range of buses is an excellent package in terms of the features, quality, reliability and price. We have also developed several fully-built buses in the MCV range.
Q: How is the city bus market for Tata Motors? Have you launched any new models in the current year? Have there been any major projects executed in the city bus segment in 2012-13?
A: Tata Motors has been a leading player in the city bus market and has consistently received large orders from several STUs as well as municipal corporations. We have received significant orders from Ahmedabad under the Janmarg Scheme. Even under the JnNURM Phase I Scheme, in the last few years, we have executed large orders catering to the City bus markets.
Q: There is a lot of expectation that JnNURM II would be introduced by the Government. Do you expect this to happen during the current year? Have you developed any specific model to cater to this requirement other than those supplied during the first phase of JnNURM?
A: Tata Motors supplied about 6,000 buses, in around 50 cities, under the JnNURM I Scheme. The orders were received during the very difficult year of 2008-09 for the industry and were executed on schedule, from 2009-10 onwards.
In view of the difficult times that the industry is currently going through and for keeping pace with the urbanisation mandate of the Government, we believe that the JnNURM Phase II should get introduced early next financial year.
Overall, JnNURM has helped modernise public transportation across the country. It has demonstrated that, given modern vehicles, citizens are enthusiastic about adopting them. It has helped display the capability of the industry. If a greater degree of standardisation is introduced and changes made in the implementation process, in the light of learnings, schemes like JnNURM can be immensely beneficial for citizens, improve the government’s service delivery systems, and will become a growth generator for the industry.
As part of our responsibility towards the transportation scenario in India, we continuously endeavour to introduce newer products and technologies in the public transportation domain. We have also been constantly upgrading our existing product ranges to meet the growing passenger needs and demands, keeping in mind the changing government regulations and norms.
We had introduced CNG-electric hybrid buses and offered two of them for trial to DTC and BEST. These are running on major intra-city routes for six months.
Q: How is the inter-city bus market for Tata Motors? How many units were sold last year in this segment and has there been any significant development that you would like to highlight?
A: The inter-city bus market is divided into two segments. One is the chassis-based market with high levels of customisation and the other is that for fully-built coaches.
Around 600 chassis are sold per month, and Tata Motors has a 50 per cent market share in this segment. The coaches are built locally on these chassis. The fully-built luxury coach market is sized at around 50 vehicles per month. In total, the market size is around 7,500 vehicles annually, of which Tata Motors has an overall market share of 50 per cent.
Recently at the SIAM Bus Expo in Noida, we showcased a fully-built coach on our renowned LPO 1618 platform. This bus is built by Tata Motors Marcopolo Ltd. with world class design & body building techniques. The bus, well appreciated by customers, offers a unique advantage of zero waiting period for body building and also the ease of financing on the bus body. We shall also be introducing new variants and models in this highly evolving and competitive segment in due course of time.
Q: How is the Divo inter-city luxury bus business? You had showcased a multi-axle version at Auto Expo last year. Have you already launched the multi-axle version in the market?
A: We did not have presence in the fully-built luxury bus market, which we intend to enter and be a significant player in this market. We aim at a good marketshare with our world-class offering – Tata Divo. We had showcased our multi-axle luxury coach at last year’s Auto Expo. This unique G7 body design is acclaimed worldwide and was a major attraction at the Expo.
Q: Tata Motors has been moving towards offering fully-built buses, and for the purpose you had established your own bus body building facility with Marcopolo in addition to ACGL? Can you provide an update on both the units?
A: Our JV with Tata Marcopolo (Brazil) and ACGL (Goa) were started with the explicit intent of providing the best fully-built offerings for customers.
Today, Tata Motors is ready with its fully-built bus range. It offers fully-built solutions for the luxury bus segment, inter-city travel, staff contract carriage applications, school applications and the health-care industry. We offer fully-built buses right from a 16-seater to a 56-seater in various configurations and intended usage applications.
We offer an extensive range of buses, namely, the Starbus range, The Starbus Ultra range, The CityRide Ex range and the Luxury coach in the form of Tata Divo. The Starbus, Starbus Ultra and CityRide Ex range vehicles are manufactured at Tata Motors Marcopolo Ltd.’s plants in Dharwad (Karnataka) and Lucknow (Uttar Pradesh). The MCV and CNG buses get built at the Lucknow plants, whereas the LCV and ICV buses are all manufactured at the Dharwad plant.
ACGL is again a JV with the intent of proving the best solution to the price sensitive clientele. We closely monitor capacity utilization to ensure cost-effectiveness and working capital management.
Q: How is Tata Motors’ presence in the school, college and institutional bus segment? What is the company’s marketshare in this segment?
A: We have the best range in the school bus range, namely, the Starbus Skool range, the Starbus Ultra Skool range and the newly introduced CityRide Ex Skool range. All these buses are specially built for transporting children in utmost comfort and safety. We currently hold over 50 per cent market share in this segment. With the recently launched Citiride Ex Skool and the Ultra 56-seater Skool we hope to further increase our market share in this segment. In terms of safety, we also provide 25 safety and comfort features in the school range of buses which include all the government mandated ones and additional features.
To sum up, Tata Motors has a dominant market share in the fully built buses segment in the LCV/ICV range. With further plans to expand its presence in the segment by launching newer platforms and variants, the market leader is gearing up to set new standards in the highly evolving and competitive Indian bus industry over the next few years.