We are enhancing our reach in the rural market

Interview/ Venkatram Mamillapalle, managing director, Renault India

58-Venkatram-Mamillapalle Venkatram Mamillapalle | Amey Mansabdar

IN 2012, RENAULT changed the Indian passenger vehicle segment for good with the Duster compact SUV. Over the years, however, it ceded the market to Korean rivals and needed a new weapon to regain it. The French carmaker is betting on the Kiger, which is built on Renault Nissan’s new CMF-A+ modular platform and will compete with the likes of Hyundai Venue and Kia Sonnet. At an introductory price of 05.45 lakh for the base model, it is the cheapest in the segment but has all the bells and whistles to get buyers’ attention. Venkatram Mamillapalle, managing director of Renault India, talks about the company’s expectations of the Kiger and the broader plans.

Q| The Kiger is cheaper than some of the hatchbacks.

A| It is the value proposition; what you are giving to a customer. We did it for Triber (launched at 04.95 lakh, it was among the cheapest seven-seaters) a year back. When we mean that it is a value proposition, the whole logic is a little different. You can load the car with features that are never used by customers and still they have to pay a price because there is nothing else available. We don’t do that. We do a full range; if you want something you can pay for it. If you don’t need it, you don’t need to pay. How many people use sunroof in India? Is it worth it? If you open the sunroof in Delhi, by the time you open and close, half the dust is inside and I have a PM2.5 filter inside my chamber and it has no use. So, we have got to be a little sensible. Why should a customer who uses it once or twice in a year pay the price? That is how I look at it.

Q| You are launching Kiger in a fairly crowded market.

A| People asked the same question about Triber in 2019—’How confident are you that it will be an innovative product?’ We proved it. Consistently I am selling 5,000 units (of Triber) a month and I don’t want to sell more as I don’t have the capacity. Kiger will be no different. People have to see the value of the product. I have a naturally aspirated engine with MT (manual transmission), AMT (auto manual transmission); I have a turbo engine with MT and CVT (continuously variable transmission). You have four powertrain systems and you can select whatever you want. I have a dual-tone (colour) in this and if a customer wants a dual-tone, floating roof, he can get it. This is how you bag up and we are giving options to customers. You pay what is exactly required. If you don’t require it, you don’t pay. That is the value proposition approach we are taking.

Q| How will the Kiger drive Renault’s growth in the Indian market?

A| I am getting into the market which is 50 per cent of the total industry volume. Now, I am going to swim along with the competition. Who swims faster is the question, who swims better is the second one. Let us see what happens. We will get the results very quickly. We will do exactly what is booked and we will deliver those. I have already started shipping cars to dealers. So, the waiting period is not going to be long. That is how our approach is.

Q| Where do you see Renault’s market share in India in three years?

A| Currently, we have a market share of 3.4 per cent, and we are number six in the ranking. If the TIV (total industry volume) grows, then it is better. If TIV doesn’t grow, the market share, with this product in, I want to be somewhere close to over 4 per cent. That is the target. We are working in that direction and we have the network now. By the end of 2022, I should be there. Not only that, I have to be profitable in India. We never made profits in 10 years.

Q| With the wider product line up you have now, are you looking at expanding your market presence?

A| We are going deeper into the country, which is rural markets, and with Triber and Kwid, the success rate is pretty good. We are further enhancing our reach in the rural market. For instance, we currently have 500 rural sales executives and we are going to build on that. This year, we plan to employ another 500 in the rural market and we will double that over a period of time again. This is the whole strategy. We are also elevating the society in the rural towns by getting the product, getting the service to their doorsteps. They also have a social elevation desire and we are feeding that.

Q| Renault is going to cut production globally by 2025, but India is one market where it is investing more. How key is India for Renault from a global perspective?

A| This is definitely an important market. We have done three debuts in India. Due to the pandemic, Renault is scaling back in other countries. They are much more severely affected than India. Looks like Asia is better than Europe or the US. The total industry volumes are dropping in South America and the US. Here the industry volume is going up.

We have been making huge investments, the number of cars we have brought in, and we will continue to progress as per the needs of the Indian customer.

From a global perspective, Renault India is number 10 currently, and we are aspiring to go higher. With this (Kiger), I am sure we will. If you ask me, I want to be equal to France. But, I should be at least seventh or eighth rank.

Q| Will Renault export Kiger from India?

A| The focus will be India. Then we will look at all the right-hand-drive markets and then see what is next. We will begin exports this year; it is a simultaneous activity. But, it doesn’t mean if I am overbooked here, I will divert exports. I can’t do that. We have made some promises to those countries, based on some commitments here. We will try to balance both. The Kiger has 95 per cent local content, the 5 per cent includes things like chips (semiconductors).