Auto India, Car India

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Certain decisions in business have always given some players opportunities laughing all the way to the banks & for others, sending a shock wave amongst them and forcing them to run for covers as well.

We are talking about the government decision to free the fuel prices; a move which has made all eyes flocked to Tata motors, which is set to gain an edge over Hyundai & Maruti, as India ended state control on gasoline prices.

When you think of the beneficiaries of this move, the first name that surfaces is of Tata Motors who have a sizable number of diesel operated vehicles.

Tata’s mainstay for sales has been its diesel models, and the company sells its Indica hatchbacks & indigo sedans that run on the fuel and a same model is also being planned for Nano, the world’s cheapest car.

When compared to Tata, Maruti’s share in the diesel run car segment is a paltry 20% and even less for Hyundai.
Honda Motor, however, is not at all in the picture as it does not offer any such cars.

Hyundai and Honda don’t have any diesel engines for small cars. These two companies will be adversely affected.

Under the new fuel system, gasoline prices will be tied to global crude prices and Bharat Petroleum Corp., India’s second-largest state-run refiner, may now change gasoline prices every 15 days or monthly.

Oil Secretary S. Sundareshan was quoted as saying.

Acting fast on the current move, Honda is reported to be developing a diesel engine that will be introduced in India soon.

General Motors, on the other hand, which sells both diesel and gasoline models was seen receiving increasing demands for the diesel models over the petrol one, even before the pricing changed.

Tata,s share notwithstanding, it would be critical to witness who on the longer run is able to control and rule diesel operated model section!