MG Motor India, the local arm of the British carmaker, is working on an ambitious plan to be present in regions that account for around 80 per cent of the SUV sales in the country by September this year.
The new entrant in the fast-growing Indian automobile industry launched 120 touch points including 70 showrooms and 50 workshops simultaneously on Tuesday. The company is hoping to gain from this network of dealerships and workshops, President and Managing Director Rajeev Chabha said, adding the firm will be able to more than double the 120 touchpoints to 250, which will primarily cover tier I to tier III cities, over the next three months.
"By September, we will have 250 touch points and with this network we would be present in approximately 80 per cent of the SUV segment in the country. So, wherever SUVs are being sold in the country, we would be present in 80 per cent of that market in three months," Chabha told ETAuto on the sidelines of the launch of its flagship dealership in Gurugram.
MG Motor India’s showroom launch comes at a time the Indian auto industry is going through a dealership shutdown crisis amid muted sales. As a strategy, the company has decided to have limited number of dealer principals to keep in check the discounting and dealer viability issues, Chabha said.
"With less number of dealers and more touch points, we will have more control on the discounting front which takes care of the brand image and residual value. Additionally, controlling discounting will also help in managing the dealer margins," he explained. "Today we are starting with 120 points and have 50 dealers. Going forth, in most of the locations, we are going to have just one dealer in a city to address the discounting issue,” headded.
Also, unlike other players in the industry, MG Motor India has decided to focus on the retail sales number rather than wholesale. “We do not want to adopt the behaviour of pushing the stock to the dealers. Ultimately, we want to be known for actual number of vehicles we have sold to customers,” Chabha said.
China's SAIC-owned MG Motor is starting its India journey with the country's first internet car SUV Hector, which is slated to launch later this month. With around 300 India-specific changes, the 7-seater model will be equipped with the first petrol 48V mild-hybrid system in the mid-size SUV segment.
"The SUV segment is a pretty big space. The beauty of Hector will be that it will be playing on B side as well as the C side," Chabha emphasized. The company has, thus far, invested Rs 2,200 crore in plant setup at Halol, Gujarat which has a production capacity of 80,000 units per annum.
Overall, MG Motor India plans to launch four products in two years, including its locally assembled electric vehicle EZS which will be out in the Indian market by December 2019.