Category Archives: Cars

Should the auto sector slowdown be our biggest concern?

The weeds of India’s economic slowdown have been growing pretty rapidly over the past 12 months. There have been various stories in news of varying levels of concerns over the systematic reduction in growth of different sectors and commodities. Probably the earliest indicator was the lack of job creation across the country, and this concern got a major boost thanks to the elections with every opposition party highlighting this. I did a simple Google Trends search on the term ‘jobs crisis’ and it has been searched pretty consistently over the last year. However, given the current state of our media, apart from the opposition’s concern leading up to the elections, the unemployed haven’t found solidarity from anyone since then.

This gets me to the other end of the spectrum of attention, the slowdown in the auto sector. Again, looking at the Google Trends data, the term ‘auto sector crisis’ really started being searched from July 2019, peaking in late August and September at the time of writing this post. While any sector that is facing tough times deserves air time and attention (especially one which is facing its worst crisis in 19 years), this still is a fly in the ointment for me. India is largely a poor country with over 21% living below the national poverty line in 2011 – this is approximately 280 million people (that is over 10 times Australia’s population). The GDP per capita in India is about INR 182,500, which is a pretty misleading statistic for a country which has the number of poor people India does. Is there a more relevant measure we can look at?

Every year, Credit Suisse publishes a Global Wealth Report which analyses the household wealth of 5 billion people across the globe. I do believe wealth is a much more important metric to look at as opposed to income. For a simple comparison, wealth is the net worth of a person, which takes a large amount of time to acquire, while income is amount earned by a person for a transaction and is often immediate. When one looks at a sizeable investment in an asset like a car or a house, wealth I believe is a better measure than income. As per the 2018 Global Wealth Report, the mean wealth per adult in India is $7,024 which is approximately INR 512,752. However, this again is misleading. India has an adult population of about 850 million, and as per the report, 90.8% of the adult population has wealth below $10,000 or INR 730,000 and we still have managed to rank sixth in the world for the number of people with wealth above $50 million. Given this kind of absurd gap in wealth, median wealth would be a much better indicator than mean. As per the report, the median wealth per adult in India is $1,289 or INR 94,097. To simplify, there are approximately 425 million adults with wealth less than INR 94,097. The average Indian cannot even think of affording a car (also read this, maybe another post to discuss it later). With this in mind, should slowdown in auto sales be the concern that needs to be given so much attention to?

I do understand that the auto sector generates a lot of employment in India and propping it up would also help us boost availability of jobs. I also understand that they are large borrowers, and those defaulting would hit our already limping lending sector with a blow so hard it might be difficult for the lenders to recover. However, the jobs crisis and the lending crisis preceded the auto crisis, so the latter is not the cause of the former. In fact, this is exactly why the auto sector should have seen this slowdown coming given all the indicators, and gradually reduced their production avoiding the excess inventory problem. Now they stand in line with others in front of the GST Panel demanding a tax cut. The government meanwhile even announced a policy to replace existing government cars with new ones just to clear the auto companies’ inventories. I am not even going to mention their months of ranting over the BS VI norms and impending electric vehicle boom which is still years away for India. I do not understand why we can’t just allow them to fail, that should be the cost of doing any business, after all isn’t that what we do to small businesses when we allow more FDI in any sector?

Going back to the search trends, it is interesting to compare the two above mentioned search terms, which you can see here. As is visible, the peak for auto sector crisis is higher than that of the jobs crisis, which is what is irksome. I do understand this is a very crude way of looking at media coverage or public awareness, but I do believe it can be used as a rough trend to understand where our priorities lie generally. In this case, the backing the auto sector has received for its slowdown is much higher than that received by the unemployed millions in the country. That, I believe, is our biggest crisis.

Tale of the Top Gear Test Track [infographic]

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Hong Kong Diary – Cars

Taxi

Well, it had to be about cars didn't it? I had to rant and rave about them.

I will not go hyperbole on how I keep turning my head at every street corner virtually every 3 minutes. But I do.

Given the fact that housing itself is expensive here, parking is even more so. This coupled with great public transportation, most of the ones who own cars are the ones who can afford the really great ones. I have seen some great cars in the last 10 days (apart from the classic Toyota taxis). I am listing down the ones I think are worth mentioning.

Ferrari 458 Italia (Yellow)
Ferrari California (White)
Ferrari 599 (Black) (I saw no red Ferraris, maybe because the cabs are red here)
Mini Cooper S
Mini Cooper Classic
BMW Z4 (gets a mention only because I love it)
BMW Z3 (with Matte finish Black paint *wipes drool*)
Aston Martin DB9
Aston Martin Vanquish
Aston Martin Spider
Lamborghini Gallardo
Lamborghini Gallardo Spider
Jeep Wrangler
McLaren MP4 (in the showroom)
Golf GTI
Volkswagen Scirocco
Maserati GranTurismo
Porsche GT3RS
Porsche Panamera

I will add a few more in the next couple of days I am here as I see more of them. I haven't mentioned many other cars like Mercedes, BMW and Lexus luxury cars because they are not really exotic. Of course they exist here too like everywhere else. (I will continue to pretend that the entire reading world really cares about all of what I just said)

Maybe I sound like an idiot raving about cars which others might see around them everyday, but I have never been to a place where I saw all of them within a small area in just a week's time; so screw you! Also, maybe I sound like a 5 year old kid talking about seeing all these cars for the first time, well, I am one.

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Dear Santa,

Guys love making lists. Especially lists which are similar to 10 things…

 

Considering it's Christmas Eve and with all the wish/gift lists going around, I though I would make one too. I will keep it short and simple for Mr. Claus.

 

Here goes nothing:

 

  1. Ferrari 458 Italia (Black/Red)
  2. Fiat 500 – Abarth Edition (Yes, I want both the cars)
  3. LG 55LD650 LCD TV
  4. Onkyo HT-S7200 Home Theatre System
  5.  Xbox 360 Slim – Kinect Bundle
  6.  Nikon D7000
  7.  Samsung Galaxy S 2
  8.  Be a Race Marshal at the Inaugural Indian GP on 28th October 2011
  9.  Tickets to El Clásico at the Santiago Bernabéu in April 2011
  10.  Tickets to the Belgian GP at Spa Francorchamps on 26th August 2011 

No, I don’t want some of them.

 

Yes, I want ALL of them.

 

No, they are not in any order.

 

Yes, only Mr. Claus can grant me these wishes; for now.

Merry Christmas!

Happy New Year!

Audi trying to ‘Break the Spell’

This is one of the most well made car commercials I have seen in recent times. I love the way it is attacking all the marquee and established manufacturers at the same time. This ad is made for the US market where Audi appears to be the underdog; and everyone loves the underdog.

Audi is trying to position itself as the rebel which offers all the choices that their competitors are offering under one brand and without the stereotype. It basically is telling people that you are doing nothing but conforming to stereotypes if you drive the other cars; and this would reflect directly in the statement you are trying to make about yourself. As I said in my last post, it is all about making a statement.

This commercial is an excellent example of how one can throw an open challenge to the established players in a cluttered market and try to change the thinking of the consumers to force them to choose your brand.

Finally, I love the way the R8 pulls up in the street for the kid to drool at. I just wish it was not silver! 😉

Dead end for the first ever Indian dream

I love cars! I love them beyond everything. It does not really matter whether they are Ferraris or Mahindras. I just love the idea of a car. It is so much more than a ton of steel, plastic and glass over 4 wheels! It is just a romantic experience for a car lover to own any car.

Indians got the first taste of this experience in a big way in 1983 when the Maruti-800 was launched.

Maruti_20090420

Picture Outlookindia

The one pictured above was the first model of the legendary car. It was small, good looking, utilitarian and did the job. Most of the other cars were the bulky Ambassadors by Hindustan Motors. The 800 was the perfect Indian car. 

Then came the upgrade in design. 

Maruti-800

My family had this one. The thing about 800s is, that it was the most common first car. It was the cheapest, most practical, most economical to run and not really ugly; basically a proper value for money buy. Which is the most important quality that any Indian looks for, in anything, in everything. 

Then came another major upgrade in design for this workhorse.

Maruti_800

Picture via Indiacar

This was to keep up with all the major launches from the likes of Hyundai and Tata. 

Somewhere around this time Maruti also launched the Alto. This was basically to hedge against the people who were growing out of their first cars (which more often than not were 800s) and moving on to other manufacturers.

Maruti-suzuki-alto-1

Picture Rushlane

This was not only more contemporary in terms of design, it was also more powerful, better equipped and a little more car for the little more money you paid. Once this was launched, rumour mills started working that this was the replacement to the over worked 800.

The 800 was never just a car, except maybe now. It was a dream. It was an aspiration for the Indian middle class. Let us not getting into an economics lesson and analyse why it did well for so long, others will do that. This car is a part of our culture and history now as Suzuki plans to phase it out in India. One of the major reason for doing this of course is that the dream of the Indian has evolved now. 

At the same time it is also time for those who could not even dream of an 800 to start dreaming. 

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Picture SpeakIndia

But this is not the space to talk about it. Today I reserve a permanent parking space for the first Indian dream. 

I love this car! The original design the most. It was epic!

Creative ads on stairs

Stairs06

I have often posted about creative advertisements from across the internet. Here is one more. This time they are showing off their creativity on stairs!

My favorite is the Jeep ad.

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Marketing the Porsche Panamera

So, what if you are one of the iconic brands of all time having produced products that have become objects of craving and all of a sudden you make something that seems quite hard to sell.

Now imagine this brand to be Porsche. Yup, even they can come out with a stinker of a car which is not exactly a dream to sell. The car I am talking about is the Porsche Panamera. It is by far the ugliest looking sports car I have ever seen! And it will take a considerable amount of booze for any designer to beat that in the ugly scale in the future.

So what does Porsche do? They turn to the marketing department and plead! The marketing department then try to figure out a way to make people feel that the Panamera IS actually a Porsche and it has been made the way it is, for a reason. So in comes its positioning as the first thoroughbred four-seater sports car.

The next step is to drill this positioning statement – Four, uncompromised – into the customer’s head. And for this purpose, they have come out with an absolutely brilliant creative!

What do you have as your resource if you are Porsche? What will convince the customer about this being a Porsche? Maybe showing a FEW of the older path-breaking Porshces will do the trick? Just to be on the safer side, lets say, we show ALL of the 50 Porsche models ever made – together! Sounds great!

So off they went and gathered around every Porsche they could find and made something like a teaser first.

So it sounds and looks quite exciting, the prospect of seeing the finished product. Before you go ahead and see the finished ad below, I want you to think about the problem Porsche is facing marketing this ugly car again. You know they are serious when they are putting the weight and reputation of no less than 50 cars behind just one new car. They are pretty desperate!

The concept of the family tree is quite brilliant and so is the execution. However they could have done without the gimmicky CG animation. At times the ad looks like a computer game. But overall a good strategy to market what seems like an adopted child as one of their own.

Tell me what you think!

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Ferrari 458 Italia

Love how mean it looks! The rear is not the best but still good looking. Personally, don’t really like the LEDs on the headlights.

And LOVE the exhaust note! Thunderous!