Maruti Alto and Hyundai Eon will see stiff competition from Renault 800cc car

Leading French automobile manufacturer Renault has decided to invade the entry-level car segment in India with the launch of an 800cc car. This segment is so far dominated by passenger car market leaders Maruti Suzuki and Hyundai.

Maruti Suzuki rules this segment with Alto following the league of the 800. Hyundai Eon is a new player in the market and has managed to attract a large section of customers. The other cars that will face competition with the launch of Renault's new car are Chevrolet Spark, Maruti Suzuki WagonR, Hyundai Santro Xing and the yet-to-be-launched Maruti Suzuki Cervo.

The particular segment has proved fruitful for major auto makers who have made a mark in the Indian car market. Entry-level cars comprise more than 40 per cent of the passenger car section in India. Currently, Renault offers the Pulse, which is powered by a 1198cc engine and is priced within the bracket of Rs 4.25 lacs-6.50 lacs. So, the new car will be available at a price under Rs 4 lacs as Renault is looking at a car “below the Pulse” according to Renault India spokesperson, Rajiv Mitra.

It is speculated that the car is scheduled for a 2014-15 release. This is the same time around which Datsun is expected to launch a hatchback with a price of just above Rs 2 lacs, again posing competition to Maruti Suzuki Alto and Hyundai Eon. Nissan cars are manufactured at a factory near Chennai, but the Datsun hatchback will be possibly manufactured at a different location. However, the Nissan plant, which also has a Renault alliance, may be used to manufacture the small car by Renault.

Renault plans to make this car a frontrunner in fuel-efficiency. The car will apparently return a mileage of around 20 kmpl on city roads with an ARAI rating of 24-26 kmpl. This factor will greatly impact the car buyers in this segment for whom fuel-efficiency is a major motivating factor.

However, another point which will have a significant effect on the fate of Renault's 800cc car will be the after-sale services in which Maruti Suzuki is thus far unmatched and Hyundai is fast-emerging. Low-budget cars can find their way to the remotest areas of the country. However, finding a service centre in these locations gets difficult, and so, people generally prefer trusted brands in this segment.

With another couple of years to go before the launch of the new car, Renault has enough time to fix other problems which might hamper its sale. The small car has the potential of turning the tables for Renault in the Indian passenger car market.