Transcription
[Music] It's not only in India. As we've seen globally, the Chinese are just taking a march with EVs. And as we've said before, the bestselling EV today is Chinese. In a market like India, it's so cutthroat. And to build a brand, you may probably have the best product out there. But if you don't really create that mind share and buzz in the market amongst many options, it's a challenge.
On the one hand, you might feel that, you know, Stellantis doesn't need a third brand. Uh, they've not managed the first two brands. They should get that right before getting a third brand right. But on the flip side, this could be the brand that saves them. I just hope that uh the go-to-market strategy is addressed and we eventually have a localized portfolio to ensure that candles have some skin in the game wherein they are shell becoming smaller and smaller and that's what the Chinese are doing. They're really playing on all our emotions.
Yeah, absolutely. You know, and whether it's our wallet, our heads, our hearts, everything they are, you know, kind of playing on that.
Hello and welcome back to your weekly dose of everything automotive on our podcast deep drive powered by Kotak Mahendra Prime. Now this week we are going to be talking about a new wave of EVs that is coming from completely new brands and the latest brand to have officially announced their arrival is Leap Motor. That's what we're going to be talking about. I'm Hmma Sabji. I'm Kithan Taker.
Yes, Hmas. It was a scoop last year. Uh, it started with the uh feasibility study. Uh, eventually uh the announcement was made by Carlos. You got it out of them at the Beijing show, I think.
Absolutely. And uh yes, we met the the global management of Leap Motor at Beijing Auto Show. Uh, really uh optimistic about the Indian market and uh in fact the global head of sales over there said that you know India is going to be a critical part of their internationalization strategy. uh, with Carlos Tavarez leaving, you know, there were question marks asked whether Leap Motor is coming, not coming and given the recent uh, you know, geopolitical challenges that we've had with China, it's back on track now. It's finally on track. I think with Tavarez leaving, a lot of things were in limbo, a lot of things obviously got delayed because uh, you know, when you have a change right at the top, there's bound to be some upheaval. But uh Ketan, interesting about Leap Motor, I mean you look at the company just founded in 2015, phenomenal uh it's what, just about 10 years old.
Absolutely. Going international is unheard of. I mean, to be honest uh it really puts uh, you know, a sorry face on a lot of our Indian OEMs which have been struggling for a long time to go global and still not there, but the Chinese as far as the EV race goes is it just just taken the whole world by storm and Leap Motor another one uh and I think uh, you know, it's going to be quite uh interesting because uh a lot to talk about on this podcast u uh one is of course Leap Motor as a brand and uh how how it can do and overall the Chinese EV wave and I think there's one statistic which uh is quite interesting that today the bestselling EV in the country is Chinese.
Absolutely. Which is the MG Windsor.
Absolutely. However much they want to say it's a UK product, however many Union Jacks they put on it, however many, you know, you know, Benedict Cumberbatch-es they get to talk about it, however much of a UK name they give it, we can't get away from the fact I think, you know, they it's a Bun product, isn't it?
That it is. Yeah, absolutely. And that it's Chinese. But, you know, I I frankly that's no bad thing because today they are really ahead of the curve, ahead in the technology race. And uh it shouldn't be a surprise that you know the Chinese are really winning everywhere including a market in India where they're actually fighting with one hand tied behind their back because of our restrictive policies.
Yes. Absolutely. I mean along with MG, we've also seen a slew of models from BYD, but I'm quite curious to know from you about uh their portfolio. Uh, some of them were showcased at the Beijing Auto Show and we reported that uh any insight that you could give our viewers. From what we understand, they're going to be two models: the C10, which is like an MG ZS EV kind of rival, a BYD At3 rival uh, you know, about 4.3, 4.5 m, something like that, very, very spacious uh inside and uh clearly I think they're banking on that you know as to be uh a vehicle that is in a bit of a sweet spot. I mean they're seeing how the Windsor is doing uh clearly it's that size uh, you know, maybe a little bigger uh so again they'll have to price it very competitively. Because let's face it, the Windsor success is largely on its price.
Absolutely. And tremendous value.
Absolutely. And then I think you've got the T03, which is a compact 3.6, 3.7 m city car, really tiny.
Right. Somewhere between the MG Comet and the Tata Tiago EV.
Yeah. So that's where it fits and clearly they're seeing that there is a traction over there because all said and done, even the Comet while it didn't do the numbers people thought and it was seen as you know a compromise of a car, which it still is, it still served a very uh niche purpose and you know people are loving it for that. So city usage, absolutely, city usage, it can't be a one and only car for everything, but as a city car it makes a lot of sense.
I so that's what they're talking. So they'll have these two uh products. I think they'll start with I think the strategy obviously is to go for CKD and uh Stellantis has the capability of you know productionizing this car. They've got uh a full industrial infrastructure set up over here with their brands Jeep, Citroen. So uh engine plant. So they're no strangers to this. I mean they can do this quite well and do it at a very effective cost. That's where this Stellantis uh relationship comes in. Leap Motors, no way they could have come in on their own.
Absolutely. And they came in with Stellantis after I think Stellantis bought a 20% stake in it I think for about 1.5 billion and then you have this Leap Motor International 5149 JB with Stellantis taking the lead with the view of going together to markets like India. So I think that's what they're going to do. So um so but I think the plan is to get to market fast. They might start with imports, CBUs, and then get into uh CKD. So Ketan, I think uh, you know, again another Chinese uh company coming, remains to be seen how they do, but for me the bigger question is Stellantis, not in great shape in India, absolutely, both their brands struggling. I mean it reminds me of Nissan which had Nissan and then Datsun, when the Nissan brand itself wasn't established. So I think over here you've got two weak brands, both Jeep and and Citroen, and now you're launching a third brand. In a way, it could uh if you flip it, this is the brand that could have the most potential, looking at the way um, you know, MG has done, looking at the way BYD is doing. So it doesn't need to have a strong legacy of a strong parent if the product is good, priced well, especially on the EVs where customers are pretty brand agnostic uh, you know, you've got other brands like VinFast also coming in which we'll talk about uh it could work, but uh I think that's really where the strategies and I think from what I understand the investment in the network is going to be minimal because they're going to be using the existing Citroen and Jeep network.
Yeah, they have the Stellantis brand house in order to ensure that the dealers are viable because volumes have come down to literally three digits for both the brands and it's crazy. I mean, and one of the big questions when I saw the official announcement uh uh recently last week was that what is the go-to-market strategy going to be like and uh you've uh spoken about Citroen cars. They are much uh I mean they are fantastic cars to drive uh but when it comes to their awareness, the mind share, people really just don't know about it. I think they got the product planning wrong because no features in the car and I think you know really to then retrofit features after that it doesn't work at all. So I think it was also a case of bad product planning. I've always said this, you know, past leadership in Stellantis has been very questionable, Stellantis India, and I think you know they've really botched up uh a lot of what I think were pretty solid and sensible and practical plans. You know when Carlos Tavares put in uh invested in India, he didn't go in for a brand new facility. It was a brownfield facility. Existing plants, you know, localizing uh let's say powertrain for export, clearly making India the last market or last man standing for ICE, which it probably will be. So really a lot of things done sensibly, but I think the execution was a mess.
No, absolutely. And I'm just hoping uh that you know they would have learned the lesson from the past of how they launched the Citroen brand with Carlos Tavares, as we've often as you've often mentioned that you know the focus was always on cost on cost. Hopefully now uh there will be a change in strategy and they'll be spending a lot more money in building the brand because in a market like India is so cutthroat and uh to build a brand you may probably have the best product out there, but if you don't really create that mind share and buzz in the market amongst many options, it's a challenge. Absolutely right. I remember one of the Jeep dealers telling me he was telling the guys they you know just outside my showroom just for people to have some awareness so they just did not spend, they did not invest in the and clearly because uh, you know, that would eat into margins and it was all about margins, but in India as we've always said, you come in as a new brand, you have to pay your entry fee and that means making a big loss initially and then hopefully you know with the brand you have to buy market share, you have to absolutely to start off with, but then you need to do that to get that scale because scale is so important in the Indian market because you're forced to localize to be cost competitive, absolutely, and to be localized you need scale, so really it's a challenging market, but I think uh, you know, with with EVs it's been slightly different actually because uh I think uh uh you know everyone's basically on the same baseline starting from zero in a way because uh you know whether it's the brands, whether it's the technology uh more level playing field, it's more of a level playing field.
That's right, it's more of a level playing field, so I think uh here's where new brands have a stronger fighting chance. Absolutely. And I'm just uh hoping that you know with with the recent investment that Stellantis has made in the brand, with bringing Mahindra Singh Dhoni, frequent interventions on the product. I'm really curious to hear from Mr. Hazela as to how the go-to-market strategy for the Leap Motor brand is going to be and they would really need to spend a lot of money. Um, you know, whatever little preliminary understanding that we had before going to Beijing auto show last year, met the global management there, clearly what was visible Hormas was that portfolio was just absolutely right for India, right from a segment hatches to B segment SUV, C segment SUV and amazing prices and kind of feature sets that the Indian consumer is actually willing to pay price for. So the you know it's the fastest growing brand right now amongst the fastest growing brand in China, everything is growing very fast uh in 24 Leap Motor actually sold about 2K93,000,000 cars, 100% growth uh and the Leap Motor International has been the biggest pillar uh outside of the growth in China and and I I remember the top management telling me that India is definitely a key part of their internationalization strategy. So they really have big hopes on India. The question is whether that CBU moves to CKD, that CKD moves to local production. Clearly there's an appetite for Indian consumers to buy such kind of models. I just hope that uh the go-to-market strategy is addressed and we eventually have a localized portfolio to ensure that candles have some skin in the game wherein they are shell becoming smaller and smaller.
I think what's interesting Ketan is that if I were a Chinese OEM, I would jump at these opportunities because FDI from a Chinese OEM is not possible. I mean there MG has done it now with a joint venture with JSW. That's one route. And again, you know, Leap Motors doing it with Stellantis. With Stellantis, BYD still very, you know, importing. They've been unable to invest in a big plant to localize and manufacture here. That's not happened. But despite that, they're doing some pretty decent numbers. Their products are fantastic. They've made a mark already. So, I think from Leap Motor standpoint, this is a fantastic opportunity to get into the Indian market on the back of the joint venture with uh Stellantis. So I think uh, you know, it again brings to the you know the Chinese question. I'm sure uh what's interesting is that none of the OEMs want to kind of flaunt their Chinese badge or their badge. I mean it's really hilarious especially with MG. It was as I said earlier all about it being British, being a British brand. Uh so but clearly all the products are Chinese and you know I think uh at one point uh the C word was a bad name. Firstly from a quality standpoint, you had a lot of uh you know cheap Chinese two-wheelers catching fire and causing an issue. Then of course we had the uh Galwan incident and uh you know obviously the friction at the border, the worst ever in in decades, which again has this wave of uh anti-China sentiment, but you know the consumer has quietly forgotten that because at the end of the day when the product is compelling, you know they're just going to go in for it, they get the right value and today I think you know uh in EVs being Chinese is actually uh a strength, exactly. So I mean let's not forget all the batteries are Chinese. All the top makers are using uh Chinese batteries whether it's Mahindra, Tata, you know all the top players. Of course, the Koreans will continue with uh uh Korean batteries, but uh I think you know this is inevitable and I think that's uh really uh how it's panning out today because it's not only in India as we've seen globally, the Chinese are just taking a march with EVs and as we've said before the bestselling EV today is Chinese and in what just a span of one year since its launch, absolutely, it's just wiped out everything Tata Motors did in terms of leadership, I'm saying model-wise as a as a as a as a they are still number one but in in all that work in five years it just gone in with one one model. I mean today the Windsor is just hammering every uh Tata product. We have to see what Mahindra does with their portfolio, but again we all know they're struggling with software issues uh, you know, it's been a slow release uh slow into the market so whereas with the Chinese they're just so good with things like software and uh you know technology, EV technology, G that uh and at and a phenomenal price.
Absolutely. I mean Windsor at 15 lakhs. You just can't go wrong at that. And they're going to sweeten it further with a bigger battery. Uh that's that's the launch uh later this month uh which is with the bigger battery, you know. So again uh adding to the value proposition of the brand. You you you said it. So I think you know this is a very interesting situation. So on the one hand you might feel that you know Stellantis does it need a third brand. uh they've not managed the first two brands. They should get that right before getting a third brand right. But on the flip side, this could be the brand that saves them actually because Jeep is going nowhere. Uh Citroen struggling. I mean Jeep, you know, Compass, nothing really happening after that. We don't know. This supposed to be a a new all-new platform. I really don't know where that is because I think after Tavares everything is up in limbo.
Absolutely. So this could be the brand that actually saved Stellantis.
Absolutely. Absolutely. What was one thing about the Chinese brand? I think uh in no time BYD has turned into amongst the most uh valued automotive company in the world and uh exactly what you mentioned you know from the uh skepticism during the Galwan days to now friends ask me as to how are these BYD cars and the conversation conversation earlier used to be what about Tesla and nowadays given the fact that BYD has beaten Tesla globally and all of a sudden this positive resonance of having a Chinese brand and you know they've proven themselves globally, they are making waves and some of the products you know those uh uh floating car you know sailing car and and and and and those clips are going viral and people are really keen to see what more Chinese brands are coming into India so it's like I mean I agree with you I think that the perception has changed, people are a lot more open to Chinese brands and if positioned well, if priced well it could probably be the backbone of Stellantis in India actually.
Exactly and you know as you rightly said today BYD is the absolute star of the EV world, why of the automotive world I I mean, imagine who would have thought that they could take on Tesla and beat them. And you know, their rise has coincided with Tesla's decline. We know the mess Tesla is in. You know, Elon Musk has not been focusing on the company. His investors want him to do more of that and spend less time, you know, in the US administration. Uh clearly, you know, the market cap has lost. Of course, they're still very strong in certain areas, you know, especially on the autonomous side. But, uh, you know, when you look at their offering, the products are generally dated. uh you know they're just not right up there in terms of interior quality whatever and BYD has just just taken the lead. It's been a stellar stellar ride. So I think BYD really being the vanguard of uh you know let's say the Chinese charge into the EV world and clearly you know the others are also they're not far behind. uh I think uh as we know even JSW is looking at uh uh you know let's say having its own platform with a JSW badge on it and where do they look, China you know so whether you've got J you've got Cherry you've got Great Wall you've got so many out there to just get the platform from what happens to it we don't know but the fact is you think EV it's got to be China that you know is at the top of the list right now because they're really ruling this space and how interesting you mentioned JSW in fact when JSW was wanting to make an entry into India before they could partner MG they had in fact visited Leap Motor and there was a discussion of securing that platform so there are multiple conversations going on, one was with MG and exactly what you mentioned for their own brand uh if if I'm not wrong even Mahindra guys have visited Leap Motor right uh so clearly it it shows that Leap Motor has really proven itself at a very early stage of its evolution and some credible products and right product from an Indian standpoint so Uh I mean definitely for future platforms, power trains, uh the dependency on China is going to be significant and we're going to probably see more and more models and we've been saying this 2025 is a year of EVs and uh um you know and we're going to see many more brands also coming.
Absolutely. And you you very interesting your point about Mahindra talking to Leap Motor but you know right now even Volkswagen Skoda or Volkswagen they in China uh for the platform they want to bring here uh I mean they have an association with Xpeng or XPeng I don't know how to pronounce these names you know and clearly there's a Chinese connection even Volkswagen has a very strong Chinese connection even uh you know for their EV play for India absolutely because clearly you know in certain areas of software electronics you know they really are phenomenal and very very cost competitive. So I think uh you know something that's inevitable I think uh from an Indian standpoint um while it's great for the consumer I think uh it's a real wakeup call for uh our industry and for me the wakeup call has been that the Windsor has beaten every other Indian model EV model to be the bestselling car in the space of one year. That should be a wakeup call for a lot of the Indian know especially Tata Motors which I feel sad that you know after this phenomenal early mover advantage they had and you know it was amazing when um it was really the push of the chairman Mr. the Chandra Shakhar and he said in an interview that he just gave Gar one year to get it out you know and and you know what a way they took the market by storm initially but I think they seem to have lost that kind of first mover advantage because now you see the the EVs that are coming out they're on skateboards so the skateboard benefits are being seen by customers as well uh you know the the value proposition is is great by these uh new incumbents you know and and and then clearly I think it's something which is is a is a trend which I think is going to increase in the future.
Yeah. And it's it comes on the back of massive scale in China, isn't it? That they are able to bring in these models.
Absolutely. At amazing prices and just the kind of features that the Indian consumer wants to pay for.
Exactly. So I mean I think our tastes and their tastes are pretty much aligned. You know they they love gizmos. We love gizmos unlike in Europeans where you know you you don't want too many gizmos. you want a very kind of a let's say sober interior. I think that's the approach which uh Citroen took and it didn't work you know bringing that European mindset over here whereas I think we are more as consumers more attuned to a Chinese mindset.
Absolutely. What what do you think of I mean if I could just bring in other brands uh VinFast? Yeah, I think absolutely I think similar I think VinFast we know has huge plans over here and clearly we have to see their the factory is just about starting by the way.
Exactly. So uh the point is I think uh in the EV space it's it's very interesting as you said a level playing field all brands uh have a chance uh over here uh you know and to really you know take on big giants like Maruti Suzuki which in the ICE space are so well entrenched and very difficult to dislodge but in the EV space it's uh completely different. I mean if you look at it um the top uh the the top players in the EV space are not necessarily anywhere close to being uh top in the ICE space. Take MG and you know and and and even BYD for that example. We're not there in ICE at all.
Absolutely. So I I think uh it is going to be interesting times. I think great for the consumer and I think you know there's a different mindset when you buy an EV. You know you're not so much worried about residual values. Um uh uh you know you're not worried that much about the service network. You just assume the vehicle will be reliable, easily flexible with just software updates over the air. So that you buy it with a different mindset and that mindset allows you to even go for absolutely unknown brands.
A lot more experimental. Exactly. That's what I feel.
Yeah. And what about what do you think of uh MG some of the models? Uh you know we're going to see slower models from MG from VinFast hopefully Tesla.
Yeah. I I think uh from MG we're going to see as you said the Windsor is is going to upgrade it right now. I think we will probably see uh M9 uh MI MI MI MI MI MI MI MI MI MI MI MI MI MI MI Mi9 but you know I'll be honest uh this is uh made by the commercial vehicle
Division and uh, I just hope that quality is good because on the uh, Glouester, which is the Maxis brand, uh, quality was pretty patchy uh, not there. So I think it's made by a different company altogether. So uh, I think the M9 hopefully won't have those quality issues. But as a product, uh, super, super uh, you know, let's say competitive, looks fantastic, and you know, it's a something you just want to be in immediately.
I think what's interesting also is the cyber stuff. Yeah. But I think challenges over there. I think they've got little stuck with the whole this whole CKD issue, which uh, CKD SKD issue which has become, I think authorities are becoming really, really uh, anal about and particular about, and you know, we've seen what's happened with Skoda Volkswagen on that. So I think the cyber which was to launch at a CKD price of 60 lakhs, I think will come initially as a CBU of 75 lakhs. So I think they lost a bit of that uh, you know, let's say uh, edge. It would have been phenomenal at 60 lakhs. I mean, for that sort of performance, but that just goes to show you know if you can localize it, you get mind-blowing bang for your buck. I mean, imagine a car, a 60 lakh car that does 0 to 100 in uh, you know, three and a few seconds. Wow. It's just crazy and it looks fantastic. Design is superb, and that's what the Chinese are doing. They're really playing on all our emotions.
Yeah, absolutely. You know, and whether it's our wallet, our heads, our hearts, everything they are, you know, kind of playing on that. So, I think um, yeah, it's going to be really, really exciting times.
Yeah. Any uh preliminary understanding on VF6, VF7 from uh, VinFast?
You got Well, I think you know uh, I've not driven them, but this is what we hear. But I think uh, as you know that I think in the US didn't get very good uh reviews. Uh, I think uh, you know, quality has been a bit iffy, the reputation, but I think again, you know, I'm sure they're fast learners, very aggressive uh, learn very quickly, again they'll be super competitive, and I think uh, you know, that also could be a brand to watch out for. So I mean, what's uh fantastic is that all these offerings are going to be in that uh, if the T uh 03 from uh, Leap Motor probably sub 10 lakh and then VF6 VF7 at 25 30 lakh, so some phenomenal option uh, global option uh, EV option in the mainstream of the market and uh, that uh, saying of 20 25 being the year of EV, I mean clearly, I mean a lot more exciting stuff coming up for us.
Yeah. Well, I still think the jury is out because uh, clearly we've not seen some great takeoff already. We already what half almost 5 months into the year, calendar year into the calendar year and uh, you know, I think uh, the Mahindras have had a slower start at least retailing the vehicles than one all variants are still not there. So hopefully all variants are still not there.
Absolutely. I think uh, Tata Motors is under pressure. Uh, really uh, Windsor is really the one that's driving it. Creta really to be honest it's struggling, Creta EV you know one would have imagined that you know the Creta SUV being such a giant that the Creta EV would at least get you know maybe uh, you know, 15 20% of the total sale, but it hasn't happened, they're under a thousand units, yes uh, which isn't great for an SUV, vision Ice form sales 15 16,000. So uh, yeah, it's going to be interesting, but I think you know coming back to our topic, Leap Motor uh, I think uh, that's going to be very interesting as well and you know while um, one can view it in multiple ways, you know whether Stellantis should be getting into this right now maybe I think uh, you know, it's the smart thing to do because uh, clearly this is the brand that could eventually give Stellantis the footing that it needs in India.
Absolutely. I think uh, they have a dual portfolio, one for the European market and one for the Chinese market, and the the portfolio that is designed for India or rather meant for India is going to be coming from the European spec. So uh, clearly you know it's an international model that they're looking at and I'm quite excited to see as to how the pricing positioning, price positioning going to be for Leap Motor. That's going to be key because I'll tell you Stellantis has had this habit to be honest of just pricing things up. So it's really key that they do it. But I think you know the team has learned uh, it's a very kind of let's say a team that has got now the experience. I guess it's a listening organization now. It's a listening organization. They've uh learned the hard way. So I think you know they will use all these learnings into making sure well we hope that you know the launch of this brand is done in a way that you know you finally get the customers that it should have and I think you know frankly it's all about price, it's all about features, just follow the MG wins template which I think this vehicle can and you know that's uh that can give you success.
And what any timeline Hormas when when do we see these models in the Indian market?
Well, I think we're looking at the end of this year or by by the festive festive period. Ketan is hopefully get them by then. Yeah, maybe if they want to get it fast, they'll get them as CBUs. Uh, so, you know, quick to market that way, which is important. I think that's a good strategy rather than wait for everything to be localized, which takes time and long lead times required. Just get into the market now, you know, strike while the iron is hot and you know, build the brand, get people to like the products and that will also give the company an idea of the response and demand to see how much capacity they want to set up for a localized uh versions of these products.
Lovely. Yet another option, an exciting option at that, as that look forward to that one.
Absolutely. I think Kanan, great discussion as always uh, very interesting. I think uh, we live in uh uh, very dynamic times. Uh, really I think this industry is something we both love because I think uh, there's just nothing quite as exciting and lucky to be part of it and not part of it. I think we are in the heart of it and and honestly that's what we'd like to give you with deep dive our perspective and the inside stories and the inside scoop. So, I do hope you enjoyed this episode as well. And uh, please stay tuned uh, every Saturday 11:00 a.m. Subscribe so you're notified on our YouTube channel. And if you want to hear it just as an audio, a great thing to do while you're in the car, you can also catch us on Spotify, Apple Music, and Amazon. Thanks for watching. [Music]