Tata Motors has unveiled its first new models in four years, banking on two small cars to reverse the company's sliding passenger car sales in the face of growing foreign competition.
In a bid to revive its fortunes, Tata is pinning its hopes for now on the all-new Bolt hatchback and Zest entry-level sedan to tap into the small car market that accounts for the bulk of passenger vehicle sales in India.
Sales of Tata passenger vehicles in India fell an annual 37% in the first nine months of the fiscal year that ends in March, according to data from Society of Indian Automobile Manufacturers (SIAM), the steepest drop in an ailing industry headed for a second straight year of declining sales.
"We have developed new design for new world -- for the new global citizen and the Indian consumer. Designs change with time. We believe this is very good design for next generation cars, said President of passenger vehicles of Tata Motors, Ranjit Yadav, in New Delhi.
Rising interest rates and high fuel costs in Asia's third-largest economy, growing at its slowest pace in a decade, have pushed consumers to delay the purchase of big ticket items.
Last year, the India autos giant watched as its rivals launched a number of popular models, including Honda Motor Co with its entry-level sedan Amaze and Hyundai Motor Co's Grand i10 hatchback. Tata, meanwhile, only tweaked and refreshed existing models.
Small cars are top sellers in a country where most people prefer to drive cheaper, fuel-efficient compact cars as roads are clogged with traffic and parking in big cities is hard to come by.
Over the last two years, Tata has relied on strong performance at its luxury Jaguar Land Rover unit to offset weak sales at home, where it is losing market share to Hyundai Motor, Maruti Suzuki (MRTI.NS) and others.