Tatra Vectra Motors (TVML) has scrapped plans to introduce the one-tonne light commercial vehicle (LCV) in India. Binggo, as the proposed vehicle was called, has been found to be expensive for the Indian market and unviable for mass production.
Vice President – Commercial TVML, HR Madhusudhan confirmed this development and said trials of the vehicle in India returned unfavourable results. ‘Products in that range is more of a commodity than a technology driver. We had based our product on superior technology,’ he said.
The company had selected an engine and design that were superior to what is currently available in the market. The challenge was to keep a tab on the cost. Several trials and studies later, TVML couldn’t justify the viability of the product. ‘One can’t leverage on the cost if volumes are not available,’ Madhusudhan clarified. He also said a manufacturer needs a complete range of vehicles to justify the introduction of a one-tonner.
A major player in the off-highway segment, TVML could have made a significant impact on the on-road segment with the proposed LCV. This nonetheless, is not seen as a setback by the company. Reasoned Madhusudhan, ‘It is always better to let the market accept a product that push forward a product that may not be a viable option.’
Binggo, which was targeted at the inter-city cargo segment, was first showcased at the Auto Expo 2006 and the company had planned an April launch that year. Procedural delays pushed its scheduled launch to around mid-2007. The vehicle was said to be under homologation, but market feedback and cost pressures pushed the company to abandon, what would have been a serious competitor to the Tata Ace.
Earlier, the company had expected the Binggo to take on the three-wheeler players in the inter-city cargo segment, where the Ace from Tata Motors has given buyers more choice. The Tata Ace has not just been a runaway success for Tata Motors, but has also set the bar for players eyeing the sector. Tatra was betting on the fact that it can make an impact by offering a vehicle with a higher payload (1000 kgs), compared to the Tata Ace (750 kg).
In fact, Tatra’s decision not to enter the LCV segment now would provide a shot in the arm to competitors, especially the likes of Tata Motors and Mahindra and Mahindra. The total domestic LCV segment grew 12.29 percent last fiscal, aided by a 16.60 percent growth in passenger carriers and an 11.68 percent growth in goods carriers. Exports too saw a credible growth of 19.31 percent, stated data released by the Society of Indian Automobile Manufacturers (SIAM).
Growth Prospects
The overall growth at the company last year was flat at around three to four percent, but plans in the offing promises a better show this financial year.
Part of the plan would be to bring in a 25-tonne three-axle GVW truck for on-highway applications. This is another product the company has been planning to introduce for quite some time. Based on a Kamaz technology, this product is expected to be rolled out by the year-end. The delay has primarily been due to road tests taking longer time that was initially expected. Within TVML, the objective now is to ensure the design is accepted by the customers. Many components have also been redesigned to suit specific Indian requirements.
The other major product the company intends to introduce in India is an 8X4, 30-tonne product, targeted at off-highway applications. This is expected to be rolled out by the end of 2008, said Madhusudhan.The next in line would a bus chassis, expected to be introduced mid-2009.

This would be a product of the joint venture that Tatra inked with Kamaz of the Republic of Tatarstan. There are no immediate plans to build bus bodies, either in-house or through an agreement with a bus body fabricator, Tatra officials had earlier said to Auto Monitor. The choice should be with the customer, the official had said.
The company is also drawing up a plan to export fully built units to the South-East Asian markets. Initially the company was eyeing opportunities in component outsourcing, but Madhusudhan said it makes sense to look at components only at a later stage. Once the SEA markets are properly and adequately served, TVML would look at exporting its products to markets in the Middle-East, including Iran, Iraq, Qatar and the United Arab Emirates.
Core Strength
Tatra Vectra Motors’ core strength has always been in larger vehicles. In India, the company’s mainstay is the Hemang dumper, which is competitively priced vis-à-vis offerings from Volvo and the Novus tipper from Tata Motors. Madhusudhan said the company has bookings for the Hemang dumper up to 2010, and is not accepting any new bookings till September this year. There are however, some constraints in terms of supplies from Tatra’s principal in the Czech Republic and that meant fewer numbers. ‘Getting the CKDs is a challenge, not volumes,’ he said.
The company’s production facility at Hosur in Tamil Nadu, which houses facilities such as chassis fabrication, cabin welding, cabin trim, engine assembly and a paint booth, all built to international standards, has rolled out over 1000 specialty trucks and aggregates for the off-highway market. This is apart from the seat manufacturing facility it has within the manufacturing facility. TVML had entered a technical agreement with Fainsa of Spain to manufacture seating systems for luxury as well as city buses in early 2005. The seat unit can produce up to 250,000 units a year.
Under the current circumstances, where credit has become a huge concern for everyone in the auto industry, getting the right product at acceptable price and service, would be Tatra Vectra Motors’ foremost objective.

Source: www.automonitor.co.in