Honda Amaze, Ford Ecosport and Renault Duster

New Product Development

2/14/2014 D&D Assignment Bharat Sharma

Ford got 40. it now had to grapple with a waiting period of up to six months. Even though the company ramped up its monthly sales to 6. an entry-level SUV. Renault was a fringe player going nowhere in India. The compact SUV took the market by storm. "Renault found a sweet spot. For a company that barely sold 800 units a month. A weak debut with the Logan sedan (in a joint venture with Mahindra & Mahindra that lasted four years). Meantime. Overwhelmed. It happened to Renault last year. In India since 2005. and packed with a load of features. The compact SUV today enjoys a waiting period of up to nine months. priced aggressively (read lower than Duster). fortunes change overnight. Ford's EcoSport. the Duster launch brought in the problem of plenty.000-odd units. dealers had stopped taking bookings. The demand surge must be seen in this light In June. EcoSport became the talk of the town. critically analyze and compare the product development process followed by these companies for these products and the lessons we can draw from these cases.In 2013 three automobile products viz: Honda Amaze. Please research. the French automaker hadn't quite set Indian roads on fire. . Honda Amaze. A new sensation. Solution Ford EcoSport. Ford Ecosport and Renault Duster were game changers for their respective companies in terms of boosting their company's overall performance. Renault Duster Sometimes.000 bookings in a record 17 days. Its Duster was a segment creator. in July 2012. the buzz around Duster has waned a bit. another entry-level SUV. Things changed dramatically when it launched the Duster. Duster met its match. Snazzier. almost a year later. Also how does it compare against the NPD process studied in the class. an inconspicuous presence with the higher end Fluence and the Koleos sports utility vehicle (SUV). and said they will resume around April next year. debuted on the Indian roads.

Renault has grabbed a market share of 8% in the UV segment from almost zero. The launch of entry-level sedan Amaze changed all that. the Amaze contributed 85% of Honda's October sales in India.8% today. The compact SUV now contributes over 55% of Ford's total sales in India. Amid poor consumer sentiments. Since its India debut.7% in 2012-13 to 6. The Blockbuster Effect Since it entered India in 1996. The auto industry is going through its roughest patch with sales in reverse gear — in 2013-14 (April-October) passenger vehicle sales declined 4. has created a buzz around the brand and a reversal in fortunes of sorts. Consequently.313 units in March 2013 to 4. The Duster today accounts for 86% of Renault sales and 100% of its exports. So what explains this situation? Broadly. Also in the comeback lane is Honda Cars India Ltd. Honda's market share in passenger cars has moved up from 2. niche players have suddenly hit the jackpot with new launches. Honda had visibility on Indian roads thanks to its popular mid-market sedan. 3 position in the country — till March it was India's fifth largest carmaker. For good measure. three factors.Sales have since moderated. One is the slowdown itself. Priced aggressively. But with the launch of Duster. The launch of just one model. and armed with diesel variants.3% now. "A market that was growing across all segments till recently is seeing selective growth not just segment-wise but even model-wise. carmakers like Honda and Ford are savouring the joys of waitlisted customers. the launch of exciting models at attractive price points is perhaps the most important tool that the companies have in luring customers to their showrooms. Despite occasional and fleeting successes like the Ford Ikon and Figo. Something similar happened with Renault. it has been a fringe player. Never a high-volume player.6%. Relatively small. But poor pricing strategies. the lack of diesel variants and an absence in the mass market of compacts ensured that Honda could not build on the City's gains. national leader ." says Rakesh Batra. the EcoSport. Glimmers of Hope These are interesting times. It has also increased the overall market share (cars plus UVs) from under 1% in July 2012 (when the Duster was launched) to 2. In an environment where discounts are galore. its India journey remained lacklustre. from a high of 6. And it has leapfrogged to No.657 by October. But the dark horses haven't had a better time in years. the City. There's no longer a waiting period and it is readily available at all Renault dealers. Ford has struggled to get a grip on Indian roads. market share has inched up from under 3% in 2012-13 and is now nudging 4%.

In this fluid market and in an industry with a long gestation period. making many existing models pricier. To be sure. and the spikes are magnified. the Rs 5-10 lakh segment has become the sweet spot and is witnessing good growth. Slowdown Collides with Ambitions So although demand is soft. It didn't help that the Union budget earlier this year raised the excise duty on SUVs from 27% to 30%.8% this year so far. This is where the demand surge for EcoSport. this has significant implications. M&M's bread and butter.(auto). Take for example the UV segment. they do get noticed. only those carmakers that are able to move ahead of the curve and address the emerging segments will be able to woo the customer. says Pravin Shah. many global carmakers including Ford. Renault. The UV segment soared on the back of huge demand for diesel vehicles as petrol prices surged. Mahindra & Mahindra (M&M). Honda. CEO (automotive). Shah says. demand may have slowed but that hasn't put the brakes on the evolution in consumer behaviour. Two. Now. a slew of MNCs have launched game-changing models in India. "old segmentations are getting redefined and boundaries are blurring". "Customers now want a feel of a UV but the comfort of a sedan. earlier their major growth came from vehicles up to Rs 6lakh. Three. automakers aren't taking their foot off the accelerator when it comes to their launch plans. With the diesel-petrol price gap narrowing." says Shah. After all. investing significant money and resources. For example. This could partly be a perception issue. the Indian economy remained relatively insulated and looked promising. this is changing. the external environment — particularly policy fluidity — has only added to the woes. these . Ernst & Young. Indian consumers are also slowly moving up the price curve. As developed markets like the US and western Europe got roiled. And in fact the Auto Expo scheduled for February 2013 will be the biggest ever with over 50 companies participating. But the transformation in the fundamental attribute of the UV hasn't stopped. over the last year. In the wake of the global economic crisis. In an industry with a product development cycle of three to five years. For example. when just one or two models see a spike in an otherwise flat or declining landscape. Amaze and Duster fits in. To understand why let's rewind to 2007-08. The segment grew by 50% last year but has shrunk by 2. Toyota and Nissan began looking at India with new eyes and ambitions.

to switch from one model to another. And their recent success and sales spurt are built overnight on the back of one successful model. Renault and Nissan — now began to aspire for volumes and to join the mainstream. an automotive research firm. These buyers are usually high net worth individuals who are trendsetters who love to experiment and flaunt new products and typically have a business background. has some answers. They started investing in developing products and ramping up their production capacity. the first wave of buyers is quite distinct in its characteristics. And considering the huge waiting list for the EcoSport — bookings are closed till March next year — you would expect them to ramp up production." says Deepesh Rathore. the company says. Ford is producing just 19 EcoSports today — using not even half of its capacity. Ford's plant has a capacity to manufacture 34 cars an hour. Unsurprisingly. Between 2008-09 and 2012-13. And getting all the vendors to quickly scale up is not easy. sedans and SUVs? Mayank Pareek. The question that many are asking (including some of the carmakers) is how long will the good times last? Will they remain one-car wonders or can they follow through by creating a pipeline of bestsellers and in the process create a comprehensive portfolio that comprises compacts. production capacity for passenger vehicles went up from 1. But there is another reason why celebrations are tempered with caution. Celebrating Cautiously Demand for a select few models may have gone through the roof. And the plant is 100% flexible. but that doesn't mean automakers are working overtime to produce more of these bestsellers. all the three new launches contribute a large chunk — over half — of these MNCs' monthly sales. As a result. For example. "For now.9 million in 2012-13. EMMAAA. The game starts second year onwards when the initial charm wears out.automakers began developing new models at appropriate and attractive price points for the Indian consumer. "This is the game of the weakest link." says Piparsania. head. In . Ford." In his experience and based on Maruti's experience with its customers. You cannot make a car with one component less.93 million units in 2008-09 to 4. rather they're adopting a cautious and calibrated approach. Not quite. "New launches do well in the first year. our EcoSport production level will remain at that. this has to do with the complexity of the auto industry. chief operating officer (marketing & sales) at Maruti Suzuki. Not many at that time had anticipated the slowdown. many of these carmakers who till then were bit players — Honda. Partly. Note that almost all these players are still relatively small with low single-digit market shares in India.

Dominated by professionals and salaried class. And it is for this reason that carmakers are treading with caution." Pareek says. Honda Cars India Ltd agrees. In the first wave. This is something that the industry is well aware of. "For us these proportions [the high dependence on Amaze sales] will keep changing as we launch new models. consumers may not be waiting with bated breath. Renault and Ford are trying something similar — to have more irons in the fire and create a winning portfolio rather than just winning models. when they give a booster doze to their marketing thrust. So for instance. Moderating of Duster sales should be seen in this light. Maruti and M&M are of course dyedinthe-wool auto companies. Honda. senior VP (sales & marketing). refer to other people's experience and do not get swayed by the product hype. which just unveiled its new City with a diesel variant. "The model's success is actually built by the second wave. Gnaneshwar Sen.numbers they are small (may be under 1%) but they are influential. having carved out their significant presence with a portfolio of vehicles (M&M largely in the UV space). Early this week. Clearly. In the second wave. . but make no mistake: if they see something as value-for-money. the Ertiga's success was not too different from that of the Duster or the EcoSport. Renault too announced that it is considering launching an MUV and a sub-Rs 4 lakh car in the Indian market. In these uncertain times. when Maruti launched the Ertiga. in the second wave of marketing Ertiga. the XUV500 had a nine-month waiting period but still contributed just 17% to M&M's total auto sales." he says. Their success clearly is not built on one or two models. Honda. Ditto for Ford which is likely launching its global small car Ka in India in 2014. Ditto with the XUV500 of M&M. it sold like hot cakes and had a five-month waiting period. plans to launch three vehicles including an MPV within a year and is looking at the possibility of building a car in India for the Indian market." says Sen. by the second wave it settles down at around 20%. the focus is on the big cities and creating a buzz around the new launch. though. The crucial difference. For example. "Sustainability of sales after the initial hype is extremely important for any model to be successful. That mostly comes from word of mouth. At its peak. Maruti has found that while the top model variant comprises 80% of sales in the first wave. is that the Ertiga contributed just 8% to Maruti sales even in its best month. they'll go for it. It is for this reason that both Pareek and Sen say they have a very distinct strategy for the first and the second wave. To that extent. they are relatively conservative in their purchases. the focus is on deeper customer engagement. which also has the Bolero and the Scorpio (besides the Xylo and Quanto) amongst its bestselling UVs. Maruti launched test-drive campaigns in small cities and for Swift Dzire it conducted a mileage rally to connect with customers.

cabin comfort. maximizing the space available for people and minimizing the space required for mechanical components.. the efficient packaging of Amaze adopts a right balance between Rear occupant space and Trunk room which helps to achieve one class above interior space with significantly superior Knee Clearance.Product Development of Honda Amaze 1) Planning Phase Honda Amaze has been developed at Honda R&D Asia Pacific Co.5L diesel engine of Amaze gives best . Exceeding customer‘s expectation. The Amaze‘s Advanced Compatibility Engineering (ACETM) body enhances self-protection while mitigating damage to other vehicles in the event of a collision. India is the first country to launch the Amaze with Honda‘s latest i-DTEC diesel engine technology besides the successful i-VTEC petrol engine. Electronic Brake Distribution (EBD) which enhances braking performance. This will enable more customers to experience the joy of owning and driving a Honda car. Pretentioner seat belts with load limiters and impact mitigating headrests. The Amaze features host of Honda‘s active and passive safety technologies including Dual SRS airbags. Amaze will be a game changer for us and over the next few years we will look to increase our operating universe in India to around 50% 2) Concept Development The grand concept for the all new Honda Amaze is Smart Micro Limousine which reflects values of stylish design. The Amaze design takes Honda‘s ―man maximum machine minimum‖ concept to a new level. and fuel-efficiency. it is the most strategic model in the Indian market and has been developed with strong focus on Indian requirements. located in Bangkok. manoeuvrability and class leading space. With the launch of Honda Amaze. packaging. compactness. they were looking towards newer horizons in the Indian market. we are very confident that we are ready for an exponential growth in our business in India. Thailand following extensive market surveys in India on people‘s driving needs and lifestyles. With the best of both petrol and diesel technologies. The ABS with EBD is being offered as standard across all Diesel and AT variants. Anti-Lock Brake System (ABS) which prevents wheel locking. In line with the objective of producing more power along with strong torque at low rpm. Ltd. They‘ve worked on aggressive localization overcoming many challenges in terms of timelines.8 km/l.5L 4 cylinder DOHC i-DTEC diesel engine is the most fuel efficient car in the country with a certified mileage of 25. technology and costs to be ready to launch the Honda Amaze in India at an attractive and affordable price. Coming to the development of Honda Amaze. Head Clearance & Leg room inside cabin and offers a class leading boot space of 400L accommodating 2 piece of medium size luggage and 2 piece of small size luggage. The Honda Amaze and the compact i-DTEC diesel engine are engineering marvels and they are very confident that they will exceed customer‘s expectations and would set new benchmarks in the industry in terms of design. as per test data. The front body structure of the Amaze is equipped with Pedestrian injury mitigation technology designed to absorb impact energy 3) System Level Design The All New Amaze powered by the 1. the 1.

The two character lines smoothly integrate the Front Dynamic Image and Rear Elegant Design. it is the lightest engine in its torque performing class.2L 4 cylinder SOHC i-VTEC petrol engine successfully delivers maximum output of 88 PS @ 6000 rpm and Torque of 109 Nm@ 4500 rpm. The 1. The Front Grille design concept and aerodynamic body colour bumper emphasize the sporty image of the car and its wider shape and concave cut profile provides a premium image.5 km/l for AT as per test data. The emission from the Amaze meets the stringent Bharat Stage 4 emission standards. while giving an impressive fuel economy of 18 km/l for MT and 15. The overwhelming presence of rear view is completed by extending the rear license garnish line and enhancing overhang feeling. With an aluminium cylinder head joined to an open deck engine block. . The use of lightweight crankshaft and a number of friction-reduction technologies help to control friction in a diesel engine to gasoline engine levels.The rear combination lamp has been designed to give a wider and clearer rear view while adding a premium touch with the inclusion of chrome housing and sensitive lens cut on the outer lining to provide a futuristic image when rear light is in operation. The headlights exemplify quality and craftsmanship using large-diameter cylinders which emphasize presence and Chrome-plated parts & black garnishes provide them a 3D effect. The 1. 4) Detail Design The exterior styling of Honda Amaze is smooth and strong with distinctive character lines from front torear which ensures strong road presence even with compact dimensions.in class max power output* of 100PS@3600rpm and 200 Nm of torque @1750 rpm that makes the car so enjoyable to drive.The newly designed Alloy wheel with solid cut design makes the wheel look bigger and delivers dynamic and elegant driving performance.5L i-DTEC engine has been developed exclusively for India considering Indian driving conditions and is based on the Honda‘s latest ‗Earth Dreams Technology‘ reali zing both excellent driving performance and offering matchless fuel economy.

weld all these different parts in a single body frame. After it. gates. which is an advanced welding system for joining body frame parts. and a test for lights and electronics. reliable and easy-to-drive SUV. They are mostly manufacturing the diesel version of the Amaze. which get pressed and mould into body frame parts. Then the other parts like bumpers. it goes for the wheel balancing and alignment. which is more in demand. where it is attached to the chassis. Then the body frame gets in the assembly line. ideal for drivers looking for a vehicle with real off- . gear lever. seats. steering wheel. There is only one production line and about 30 minutes are spent to assemble a car.5) Production Ramp-up & Testing India received it warmly and booked over 22. Once the car gets complete. Product Development Process for Renault Duster 1) Concept To build a robust. General Welding Machine.making a record in itself. while rest of the capacity is being used to produce Brio and City. Then the body frame goes into the paint shop. It all starts with metal sheets. where it with other parts get painted using inverted Ed dipping technique for better paint quality.000 cars in the very first month. and lights are fitted in the car. Honda claims to produce around 5000 Amaze per month. After this an expert takes the newly assembled car for a test run on a test track in the plant itself.

depending on versions. Moscow (Russia). with high ground clearance of 210 mm. it ships in 4x2 or 4x4 versions.5 dCi K9K THP 1461 4 Cyl in-line 110PS @ 3900 rpm Displacement (cc) 1598 Engine Type 4 Cyl in-line Max Power : PS @ 104 PS @ 5850 rpm rpm Max Torque : Nm 145 Nm @ 3750 rpm @ rpm 200 @ 1900 rpm 248 @ 2250 rpm .31m long and 1. Renault Duster features specific characteristics. 2) Design Detail All-terrain vehicles are frequently synonymous with bulk. Duster is built at the plants in Pitesti (Romania).82m wide –show that this does not have to be true. the version for the South American market ships with exclusive cabin design and colours. but Renault Duster ‗s compact dimensions – 4. ABS with electronic brake force distribution (EBV) and emergency brake assist (EBA). all-terrain use.Depending on the markets. Curitiba (Brazil) and Envigado (Colombia) as well as at the Renault-Nissan Alliance site in Chennai (India) 3) System Level Design Options ENGINE & TRANSMISSION Engine Code Petrol RxE Diesel 85 RxE Diesel 100 PS RxZ Option Back 1. A real global phenomenon. short overhangs (822 mm at the front. 820 mm at the rear) and big clearance angles. The reinforced under body is suitable for all-track.6 K4M 1. In India. In terms of active safety.5 dCi K9K HP 1461 4 Cyl in-line 85PS @ 3750 rpm 1. Alongside a different grille design. Duster is equipped with a separate air conditioning system for the rear compartment with independent controls.road capacities. Depending on the market. Renault Duster features.

to give you an idea of the baby 4x4's footprint. Two bold lines on the bonnet flow onto the roof. central locking and engine protective under guard as standard features. crafted with highly qualified technical designers were involved to match the expectations of people in the Indian Market. door side sill. beautiful. manoeuvrability and fuel efficiency that comes with a compact footprint. busy traffic areas and at the same time it can also be used for long drives. The Duster has been pitched as an Urban SUV and its 205mm high ground clearance helps it become compatible both for city rides and uneven terrains. 5) Production Ramp Up Renault launched the Duster on 4 July 2012 in India. Mumbai based car designer of DC Designs came out with a Lounge variant of Duster. it has also received a lot of changes according to the Indian market. two front air-bags and three-point seatbelt tensioner‘s features are incorporated as per the variants. To add more off-roading capabilities the suspension system as well as the underside has been strengthened.‘ Ecosport is car which can be used on the compact roads. It was tested in different Indian roads and terrains to check whether it is suitable for Indian roads or not. 12. Adventure Decal on Tallgate D-Pillar. and metal finish grab handle are a few to mention. door open warning lamp. The added features are smoked headlights. reflecting Ford‘s global design language. Renault India has finally rolled out the Adventure Edition of its compact SUV Duster at Rs. Product Development Process for Ford Eco Sport 1) Concept It's based on Fiesta running gear. Emergency Brake Assist besides Electronic Brake-force Distribution. Delhi). piano black finish on the center console and steering wheel. The front end features a large. side body moulding. The Ford Eco Sport offers a confident stance.18 Lakhs (Ex.4) Testing An extensive road testing was done before the launch of product in India. highlighting . The car is currently available in 10 different variants. ‗City – ready for work and ready for play. the Duster proves it to be a safe car. Sports utility vehicle alternative to a small car. agile. stability control module. In August 2013 DilipChhabria. lime green Seat fabric upholstery and door trim fabric insert. Renault Duster Adventure Edition is available with 110PS trim only and it is more of a 110PS RxL variant with some added features. wheel arch cladding. ‗gaping fishmouth‘ grille flanked by slim headlamps and big fog lamps. out of which 8 are diesel and 2 are petrol. Having equipped with a bunch of several basic safety features including engine immobiliser. new alloy wheels. smart technology. Showroom. a high driving position and robust character on top of the agility. to second the aerodynamic design. It also comes with advanced safety features like Anti-lock Brake System. front with lamps. it's not only a rebadged version of the Dacia Duster. 2) Design Detail Contemporary design aerodynamically honed for fuel economy.

Ford and Renault have followed a normal Generic Development Process for their above mentioned models. The tailgate handle is beautifully integrated within the tail lamp and that‘s a nice touch.000 vehicles per year and 200. 4) Testing As Ecosport already existed in South American and Brazil market from 2003. 2012 respectively and also made a mark of 700.the car‘s aerodynamic prowess. Inference from the development process and NPD learned in the classroom sessions Honda.000 engine. market share and ease of entry. design detail. tailgate-mounted spare tyre and the sleek roof-rails that enhance the vehicle‘s SUV stance. According to my view. 5) Production Ramp up Ford India has invested Rs. competition and strategies none of the car would have been such a big game changer in the automobile industry. it gets the job done. Promotion and Product). The generic product development process that they‘ve used consisted of mainly product planning.5-litre four-cylinder mill. system level design. The NPD process is followed by some companies which consist of understanding the consumer‘s needs first. But for Indian market before the launch in India the product it was displayed in Auto expo held in 2012 and was tested in different weather conditions. After this step they do STP (Segmentation. humidity and also on the busy streets of India. Targeting and Positioning) and then they determine the marketing strategies for their new product where they typically think of 4P‘s (Price.700 Cr at its Chennai plant to manufacture the EcoSport. testing and Production Ramp-up. Overall. .000 plus cars in SA.000 engines with the help of new plant in Gujarat (Sanand). a 1.000 vehicles and 610. Ford and Honda has also kept in mind of the process involved in NPD and followed the generic development process. Then they access the opportunities where they concentrate on size of the market. market share. the EcoSport has a quirky design 3) System Level Design 1. And while this motorcycle-sized 999cc turbo-petrol engine may sound like a pip-squeak. Increased the capacity by end of 2014 which totalled to 440. Without considering the market size. I particularly liked the muscular fenders.0-litre Eco Boost engine. Production capacity – Initially in 2013 the capacity 250. competition. and is actually spritelier than the second engine in the range. all the three cars of Renault. Place. The only thing missing is a pair of sidesteps that could greatly accentuate the SUV‘s ruggedness.