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A Spark to Light Up Gm India? or Will it Immolate?

I was at the launch of the Chevrolet Spark yesterday. It's a good car, perhaps the most credible and promising product to have come out of GM India ever. The looks are smart and cute and the specs are promising. GM guys seemed to be gung-ho about the product.

So how important is the Spark for GM India? The importance can be gauged from the fact that GM flew in a plane-load of top guys from Detroit for the launch, including the likes of Rick Wagoner and Nick Reilly. The usage of words like "critical" and "first priority" to describe the Spark's importance to GM India should be enough indicators that the Spark is the last weapon, for a while, in GM's Indian arsenal.

And for the first time GM is not afraid to fight it out on pricing. The Spark starts at INR 309,000, though the air conditioning starts only at INR 332,000 and the top-of-the-line variant comes in at INR 424,000.

However, GM's idea of comparing spare part costs and using it as a marketing weapon causes a squiggle in my stomach. It's like Kinetic, LML and TVS using price as a weapon in the 100cc wars. They can't take on a Hero Honda or Bajaj in component prices as costs will be in proportion to volumes.

GM's statistical proof - they have an elaborate chart comparing the Spark with the Wagon R, Snatro and Estilo - that the Spark is cheaper to maintain falls flat on a few points. The most apparent and worrying is the aspect of service intervals - the Spark needs to see the doctors after every 5,000 kms (a weak point surprisingly touted as strength by Nick Reilly) as compared to the Estilo and Wagon R's 10,000 kms service interval.

When you are a small volume player, features should be the marketing weapon and the Spark has plenty of them, including the segment's first 3-yr. / 100,000 kms warranty.

The Spark has been launched one year before preparations were completed. GM's new Indian plant - meant for the Spark - is far from complete and will go on steam in mid-2008 only. Meanwhile, the Spark will be manufactured at GM's existing Halol facility which has a monthly capacity of 7,000 units. With the remaining GM models already accounting for 4500 units, this leaves only 2,500 units for the Spark. Not something that will worry the competition in a segment where the best seller sold more than 200,000 units last year.

About the Author

Deepesh Rathore
Research Editor
deepesh.rathore@supplierbusiness.com
For more details on Spark to light up GM visit www.theautodiary.com

who will win between cleveland indians and detroit tigers?

Both have done horribly so far. I think that the Tigers definitely have more skill (when both the teams play their best). But neither of them seem to get into a groove. Also Zumaya is coming back for the Tigers. But with both teams playing unpredictably, the White Sox could win.

But i hope the Tigers win, at least their division...

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