Nissan India is planning to lower the price of its much popular hatchback Micra very soon which launched its Diesel version recently. This seems to be little pleasant surprise for the buyer when every other car maker is increasing their price range from January 2011. The industry insider think the reason could be the not so good sales figure of Nissan Micra in the country. The car is more famous for its export from India than sales.
Micra hatchback is being priced much higher than its competitors in market and that is what is becoming the major reason of its lowered sales in Indian Auto market. The base model of Micra comes for Rs. 4,04,338, with high-end diesel model will cost you Rs. 6,14,000 (Ex-Showroom prices). But because of its exports which constitute the major part of its production, the company is able to maintain handsome profits for the product. Then the question arises, if the company is making good profits in foreign market then why is Nissan Micra price being considered for revision in domestic market?
Nissan India, like Maruti Suzuki and Hyundai India exports a lot of cars to Europe. While Maruti and Hyundai have a very strong Indian market to reckon with, and one that so far has ensured that cars remained sold even during the last recessionary cycle, Nissan India is yet to make solid inroads into the Indian car market with the Micra being the only product that Nissan has managed to sell over 5000 units ever since it’s launch in India.
Now, coming back to the export front, Britain and Europe, unveiled a scrapping policy a few years ago that provided incentive to owners who scrapped their cars with more fuel efficient and lower emission cars. This policy simply meant that frugal Hatchbacks were in high demand in these countries and with the 10-15% cost advantage that Indian manufacturing brought to the table, Indian made Hatchbacks were the prime beneficiaries of this policy which left Indian car manufacturers laughing all the way to the bank.
In orfer to deal with the situation, Nssan India brough the cost engineers from is Japan Headquarters and wll now hunt for bigger localisation of its products. This will hep the company reduce its cost and thus the exports will also show profits inspite of increased export duties and taxes. Thus we see a smart move from the company to maintain its profits in both domestic and foreign market.
