Indian automakers eye US market

26 June 2009

NEW DELHI: Indian auto manufacturers Mahindra & Mahindra and Tata Motors are preparing to enter the US market, seeking to take advantage of the troubles affecting major domestic operators such as General Motors and Chrysler to gain a foothold in the country.

Mahindra & Mahindra – a conglomerate which is active in sectors varying from financial services to agricultural equipment – plans to launch a pick-up truck in the US this year.

Nearly 350 local dealers in the country have already agreed to sell the compact "PikUp", Global Vehicles, its North American distributor, reports.

These diesel-powered models – which will cost around $20,000 (€14,388; £12,279) – are a lot smaller than many of their main rivals, and adopt a different design, but also offer more miles to the gallon.

According to Larry Daniel, Global Vehicles' vice-president for sales, the target consumer will be an "independent thinker", and someone who doesn't "really care what people think of what they drive."

Jeff Schuster, an analyst with JD Power, argued the segment is a promising one for the Indian firm, but also predicted the launch will be in "limited quantities and with limited fanfare, at least initially."

Tata Motors, the automotive arm of the IT-to-jewellery giant the Tata Group, also intends to introduce its "minicar", the Nano, in the US in 2011.

The vehicle, which is only ten-feet in length and has been dubbed as "The People's Car" in its home market, is currently on sale for 100,000 rupees ($2,000; €1,479; £1,263) in India.

However, according to Schuster, the "risk associated with the Nano is much greater than Mahindra's risk with the truck".

Data sourced from CNN Money; additional content by WARC staff