Tata Motors plans entry-level sedan in sub-4 metre space
Feb 24 2013 , New Delhi
Sub-four metre cars attract lower excise duty and hence allow car manufacturers to introduce new products at aggressive prices. Excise duty on sub-four metre cars is at 12 per cent compared with 24 per cent for cars over four-metre in length.
“The market for sub-four meter length sedan is growing. We are working on a compact car,” said a Tata Motors official. Tata Motors has sub-four metre Indigo CS in the market.
Car manufacturers are working on designs to come out with a product within four metres to save on excise duty and pass on the benefit to the customers. Honda Cars India has announced launch of its entry-level sedan called Amaze in April 2013. Amaze is a sub-four metre sedan built on the Brio hatchback platform and is available in both petrol and diesel engines.
Mahindra and Mahindra (M&M) is also expected to launch sub-four metre version of Verito by next month. M&M already has sub-four metre sports utility vehicle (SUV) Quanto in the market.
Both the cars will be competing with the market leader Maruti Suzuki’s Swift Dzire with an average sale of 13,000 to 14,000 units per month.
Umang Kumar, co-founder and CEO Gaadi.com said, “The entry-level sedan segment is a hot property for various manufacturers in India. This is a very important and significant segment as most hatchback car owners inspire to upgrade to an entry level sedan after a few years and with growing disposable income and lowering of interest rates on new cars, more buyers are eyeing various models from this segment.”
Kumar added that with entry of new players, market share of Maruti Swift Dzire may decline.