Slow auto market in India, but SUVs know how to endure rough terrain image

Despite all the problems the country’s overall auto market has suffered this year, there is a relatively strong demand for affordable crossover vehicles – a situation well known to Nissan and Ford which also aim for a piece of the pie.

The Japanese automaker has just officially unveiled its redesigned “Terrano” compact sport utility vehicle in India – actually a rebadged and visually slightly different Dacia Duster. The Renault Nissan group has a highly successful sharing strategy that brought Dacia models under the Renault and Nissan brand in various parts of the world.

“The Terrano will play a key role in boosting Nissan’s sales volume in India and marks the company’s entry into the expanding compact SUV segment,” Nissan said in a statement.

With the launch of the Terrano, which Nissan will produce at its factory near the southern Indian city of Chennai and start taking orders from next month, the Japanese automaker is trying to take advantage of a segment in which a Ford Motor Co executive said he expects to see continued growth.

Demand has “exceeded our expectations and we are witnessing an unprecedented demand for the EcoSport,” Vinay Piparsania, executive director of marketing, sales and service at Ford India, told Reuters.

With an aggressive starting price of 559,000 Indian rupees ($8,800), the EcoSport has proven popular since being launched in India in June, rivaling Renault’s compact SUV Duster, which starts at 800,000 rupees ($12,580).

The demand for smaller SUVs is expected to boom over the next few years in emerging markets, with IHS Automotive forecasting sales in the segment will grow from just 6,140 vehicles in 2012 to more than 126,000 in 2015 in India. In China, it expects sales to more double this year to more than 207,000.

Via Reuters