The Tivoli will be the first product from SsangYong Motor since the time Mahindra & Mahindra bought out a controlling stake in the company nearly four years ago. This compact SUV is scheduled to be launched in Seoul over the next fortnight and marks an important chapter for the partners. Along with M&M, SsangYong plans to chart out a global script for its SUV business where the Tivoli will kick off the drive.
Main attraction SsangYong’s website has interesting nuggets of information on this compact SUV, codenamed X100, right from the time it was unveiled at the Paris Motor Show last October. The company had convened a meeting with 130 dealers from 65 countries, its largest ever overseas event.
The idea was to share SsangYong’s vision and long-term product strategies. The company said it was eyeing sales of 1.5 lakh cars in 2014 of which nearly 82,000 units would be earmarked for markets beyond Korea.
By the end of the month, work on the X100 had moved on rapidly and the SsangYong website refers to excitement being “clearly visible on the faces of employees working at the assembly lines” of the production plant. This was because test-production of the pilot models of the X100 was in full gear at one of the lines dedicated to the Korando C.
Ssangyong’s CEO, Yoo-il Lee, was enthusiastic enough to say that he had recently test-driven “some 10 rival models” including the GM Trax, Renault Samsung Motors’ QM3 and the Mini. “I think the X100 has secured its own competitiveness to lure customers,” he added. What was equally significant was Mahindra and Mahindra “providing full support” for the launch.
According to the website, the X100 would be offered with a 1.6 litre petrol engine with the diesel version due to follow in July. Its global launch will kick off in April with China and Europe identified as its key markets. Lee had said annual sales of 1.2 lakh units were needed to assure profitability. There was also an emotional touch in the script with SsangYong inviting nearly 300 family members of its employees “to help them better understand the company and work environment”. The website quotes Lee saying that in order for a company to grow and become a happy workplace, “we need affection and support not just from employees but also from their families”.
He also vowed to improve SsangYong’s brand image which has been tainted by frequent ownership changes and labour disputes over the past decade. This only put in perspective the stability that has come about since M&M entered the picture.
Charting the future Lee said the automaker would launch a new vehicle every year in close partnership with its Indian owner. The next model codenamed Y400 is expected to be a “large luxurious SUV”. The only missing element in the script was the name for the X100 and this became public in November. The name, Tivoli, originates from an Italian resort town near Rome as also from Tivoli Gardens, a theme park located in Copenhagen, Denmark.
According to the company, its stylish design and premium quality will attract customers seeking “youthful, urban style and differentiated identity”. The Tivoli is equipped with alloy wheels, LED rear lamps and the "smart steer" that provides three modes of steering: normal, comport and sports. It is expected to be priced at around $15,000 (nearly ₹10 lakh).
‘Frugal engineering’ Lee was in Delhi for the Auto Expo earlier this year where he made known his views on frugal engineering, a term that has become some sort of a style statement in the auto industry. “Frugal engineering is something I do not agree with because you cannot compete globally with this concept. Low cost should not mean a low quality car,” he said.
SsangYong, he added, would also welcome auto transmission which it was buying from outside. “This remains our weakest point. Mahindras should consider having its own auto transmission plant in Korea which will help SsangYong become a complete automaker,” he said.
According to him, China, Russia and South America were the key to the company’s growth. The US, likewise, was an important market which it was “considering and studying carefully”.
In earlier interactions soon after the buyout, Pawan Goenka, Executive Director of M&M’s Automotive & Farm Equipment Sectors had reiterated that SsangYong presented a good opportunity for the Indian company to go global though there was a lot of work that needed to be done.
“I will be focusing on issues relating to strategy, long-term financial viability and major HR initiatives,” he said. Another top priority for M&M was to attract more talent into SsangYong and “create a whole lot of excitement”. Some key people had quit the company when it was going through a rough patch prior to the acquisition.
Goenka also believed that skills needed for the future were not in short supply in the market and drawing people back to SsangYong could be done with the right focus and direction. “Our research says there is no basic damage to the brand and that it has become weak due to a host of factors. It is not difficult for us to bring it back on track,” he added.