Tata Motors Remains Leader in Large LCV Mini & ICV Bus Segment

Volvo leads in the Large / Full Size Bus Category

TNS Report

A buoyant Indian economy growing at more than 8% and a robust growth of movement of goods and passenger traffic via road is driving increased demand for commercial vehicles in India. Where roads are considered as veins and arteries of a nation, passenger and goods transported are likened to blood circulation, enlivening economic activity of the country. And Passenger Road Transport is an essential concomitant of economic development and it must keep pace with the growing requirement. In India, 87% of the passenger traffic moves via road and the major players in the Passenger Carrier (Commercial Vehicle) are: Tata Motors, Ashok Leyland, Mahindra and Mahindra, Eicher, Swaraj Mazda and Volvo.

The domestic Passenger Carrier (PC) segment registered a growth of 4% in FY 2006-07, where the demand today is largely driven by the private sector players. Care Research estimates the Passenger Carrier segment in the Commercial Vehicle industry to grow at a CAGR of 5-7% over the next five years (2007-12) thanks to the improved road infrastructure, better buses and their maintenance and the expected greater reliance on road for long distances apart from short and medium distances. Buses enjoy a distinct advantage for short and medium distances because of their flexibility and accessibility to large number of villages, towns and cities. In addition to infrastructure facilities (road networks and condition), Government regulatory norms (emission, etc.), interest rates, economy health, fuel costs, the industry dynamics in terms of demand is dependent on some of the consumer preferences. To name a few, the preferences could be vehicle price, specifications, applications, technology, fuel efficiency, spare parts availability, after sales network, etc.

On the lines of TNS Truck Trak 2007, which was recently published, TNS Bus Trak 2007 aims to map customer expectations, experiences and preferences in the market and provide manufacturers with vital inputs in their efforts to enhance the customer experience. TNS Bus Trak 2007, in its first year has covered over 1200 Bus customers nationally for their Sales and After-Sales experience. To extend both width & depth to the study, the bus segments have been defined as LCV Mini Bus, LCV Midsize, ICV-Executive Bus and Large/Full Size Bus.

 
In the LCV Mini Bus category with only two major players (Tata Motors and Mahindra & Mahindra), Tata scores 82 on the Customer Satisfaction Index above Mahindra. Eicher leads in the LCV Midsize Bus segment with Tata Motors a close second with a single point difference. In the Intermediate vehicle Bus segment (up to 10 Tons) also, Tata leads the way with CSI score of 89. In the Large Full/Size Bus segment, Volvo leads over Ashok Leyland and Tata Motors.

"Better road infrastructure coupled with emergence of private players, boost in the domestic tourism and privatisation/increase of fleet of State Transport Undertakings had a positive impact on the growth of the Bus segment. This has resulted in increased demand for vehicles because of which manufacturers have not been able to match the pace leading to delay in delivery of the vehicles. While the overall purchase experience at the showroom has been rated high, the after sales service is not in the same league. This in the long run will act as a key differentiator between manufacturers and will impact the final customer brand choice," says Rahul Sharma, Associate Vice President, TNS India.

Sales Process: Customer interactions with the sales person during sales process and understanding the customer requirement came out as an area of improvement.

Post-Purchase contact and relationship management will become key drivers in the near future.

After-Sales Service the key customer concern: As in the rest of the automotive industry, after-sales service is the key concern area for customers. Their expectation on the overall quality continues to go higher. After-Sales service is rated considerably lower than the purchase experience.

Overall quality of service has been rated very low, essentially because of the below average ratings on quality of repairs and service, availability of spare parts and time taken for service and repairs.

The study also finds that managing customer expectations has become increasingly challenging as the length of vehicle ownership increases.