Asia's Low-Cost Compact Vehicle Development Chapter One Present and Future of Strategic Vehicles for Emerging Markets 1 1. Emerging Market Expansion Strengthens Importance and Influences of Strategic Compact Vehicles Globally 2 ◇Significance of Strategic Compacts in Emerging Markets 2 ◇Family Car: Once a Luxury Item but Now a Commodity 4 ◇Sales Increases of Existing Models and by Middle Class Consumers 5 ◇Concurrent Advancement of Motorization and Diversification 6 ◇New Vehicle Market Size and Perspective in Emerging Countries 7 2. New Trends Towards Downsizing, Diversification and Multifunctionality of Strategic Vehicles 12 ◇Focus on Market Change and Competition with the Appearance of Emerging Nations 12 ◇Possibility for A Class Passenger Cars to Expand Global Markets 14 ◇Sales Expansion and New Users of A/B Class Passenger Vehicles 16 ◇Acquisition of New Customers through B/C Class Passenger Vehicles 18 ◇Wealthy Stratum a Source of Profits for the Upper B/C Class 20 ◇Capturing the Young Generation with a B/C Base AUV 22 ◇Solid Sales Base Despite Reduction in Mid-size AUV Sales 22 ◇Exploiting Global Emerging Market with 1-Ton Pickup Trucks and SUV Variants 24 ◇Steady Light Truck Demand Created in Asia 24 ◇Global Potential of Utility Vehicles 25 ◇Mini Trucks and Vans: Complementary Method to Public Transportation and Infrastructure Building 28 3. Market Needs for Emerging Market Strategy Vehicles 30 ◇Compact Vehicles: Major Product in Progressing Ultra Low Cost Vehicle Development 30 ◇Motorization through Motorcycles Replacement Demand 31 ◇Ban on Used Vehicle Imports and Development of Domestically Manufactured Used Vehicle Market 32 ◇Demands for Multi-Purpose Utility Vehicles in Emerging Countries 33 ◇Delayed Road Infrastructure Building and Enhancement of Road Safety 33 ◇Expanding Demands for Motorcycles in Emerging Countries as Vehicle Demand Base 34 4. Coordinating Global Resources for Low Cost and Specification of Strategic Vehicles for Emerging Courtiers 38 ◇Coordinating Global Resources for Development of Strategic Vehicles for Emerging Countries 38 ◇Cost Reduction for Strategic Vehicles for Emerging Countries in Framework of Global Procurement 39 ◇Global Vehicle Market Expansion and Potential for Specialization of Roles by Country 41 ◇Attracting Auto Parts Industry Best Suit for the Country and Production of Strategic Vehicles for Emerging Countries ◇Utilizing Emerging Courtiers as Supply for Business Resources and Components Chapter Two Progressing Launch of Strategic Vehicles for Emerging Countries from Asia 41 42 45 Korea: Potential for Compact Vehicle Demand Increases, Improvement of Economic and Industrial Environment Required 46 ◇Market Stagnation Brought About Deteriorated Economic Conditions of Middle Class and Youth 46 ◇Market Structure Transition and Potential for Mini and Compact Vehicles 47 ◇Expectations for New Industrial and Economic Policy 48 Taiwan: Seeking Survival through Overseas Operation, Motorcycle Replacing Demand to Boost Vehicle Demand at Home 50 ◇With Prolonged Domestic Demand Stagnation, Auto Industry Seeks Growth Overseas 50 ◇ Domestic Circumstances Constrained Domestic Demand Increase and Accumulated Replacement Demands 51 ◇Strategic Vehicles for Emerging Countries Expand Potential to Create New Demands 52 Thailand: Aiming at Two Million Unit Production with Eco Car; Pickup Truck Market Follow Downward Trend 54 ◇Eco Car Projects Started to Become Passenger Vehicle Export Hubs 54 ◇Political Uncertainty Constrain the Market but Passenger Vehicle Market Remains Positive 54 ◇Aiming at Two Million Annual Vehicle Production with Compact Passenger Cars 56 Indonesia: Market of 200 Million People Creates Major Auto Production Country in ASEAN ◇Eyeing a Major Automotive Producing Country with High Market Potential ◇Economic Recovery Lifts Market Equal to the Thai Vehicle Market in 2008 ◇Expectation for Policy Introduction to Create One Million Vehicle Market 58 58 58 60 Malaysia: Roadmap to Capture Global Competitiveness Required in Industry Growth Policy ◇Automotive Policy Focusing on Protection of National Vehicle Manufacturers ◇Two National Companies Capture 60% of the Market under Protection ◇National Makers Seek Opportunities Overseas as Domestic Market Saturated 62 62 63 64 Philippines: Seeking Industrial Policy to Replace Imported Used and Converted Vehicles ◇Tightened Restriction on Used Vehicle Imports Recovered Domestic Demands 66 66 ◇Motorcycles and Utility Vehicles Complement Vehicle Demand ◇More Demands for Compacts and Utility Vehicles by Wealthy Class ◇Stalemated Policy to Replace Used and Converted Vehicles 66 67 68 Vietnam: Domestic Demand Increases with Light Commercials of Emerging Brands Polarized the Market 70 ◇Rapid Domestic Market Expansion Seen in 2007 70 ◇Growth Potential Seen in Motorcycle Population and Steady High-End Vehicle Sales 71 India: Domestic Demands with Ultra Low Cost Models to Achieve Global Industry Standard ◇Automotive Industry Seeking Growth with Compact Vehicles and Auto Components ◇Progressing Diversification of Compact Passenger Vehicles ◇Price and Sales Network Battle in Low Cost Passenger and A2 Segment ◇Aiming for Export Hub with Industrial Foundation for Low Cost Vehicle 72 72 73 74 75 Pakistan: Required Stimulation Package to Achieve Production of Half a Million Vehicles in 2011 ◇Drawing up Policy to Produce 500,000 Units Vehicles in FY 2011 ◇Fostering Domestic Industry Requires Domestic Market Development ◇Aiming for 500,000 Unit-Vehicle Production in FY 2011 76 76 77 78 Chapter Three Outline and Strategy of Strategic Vehicles for Emerging Countries Tata Nano ◇Production Plan ◇Purchasing Policy ◇Domestic Sales Strategy ◇Export and Overseas Operations Bajaj/Renault/Nissan ULC Maruti Suzuki Zen Estilo/Suzuki Karimun Estilo Maruti Suzuki Maruti 800 Hyundai 3,500 USD Car Perodua Viva Hyundai Click/Getz Kia Morning/Picanto ◇Outline of the Hyundai Click/Getz ◇Sales Trend of the Click ◇Production Trend of the Click ◇Outline of the Kia Morning/Picanto Hyundai i10 Suzuki/Maruti Suzuki A-Star (New Alto) Suzuki/Maruti Suzuki Swift/SX4/Splash 81 82 84 85 86 87 88 90 92 93 94 96 96 97 98 100 102 104 106 GM Daewoo Matiz/Chevrolet Spark/Chevrolet Beat ◇Research and Development at GM Daewoo ◇Sales Strategies of the Chevrolet Spark and the Chevrolet Beat Tata Indica Vista/Indigo Chery QQ/A1 Perodua Myvi/Daihatsu Sirion Proton Saga/Iswara Proton Savvy Toyota EFC VW up! Eco Car Toyota Soluna Vios/Vios: Toyota Yaris/Vitz ◇The Soluna Vios/Vios: Asian Exclusive Sedan ◇The Yaris/Vitz: Global Strategic Hatchback Honda Fit/Jazz, City ◇The City: Strategic Sedan for Emerging Markets ◇The Fit/Jazz: Global Strategic Compact Nissan March/Micra Renault/Dacia Logan/Sandero VW Polo・Fox・Gol Skoda Fabia ◇VW Polo ◇Skoda Fabia ◇VW Fox/Gol Mazda2 Ford Fiesta ◇Mazda2/Demio ◇Ford Fiesta Fiat Palio Fiat Linea Chevrolet Cruze Proton Gen-2 Proton Persona Hafei Lobo/Naza Forza Lifan520 Geely Freedom Ship(CK1) BYD F0 110 111 112 114 118 120 122 124 125 126 127 128 129 130 132 132 134 136 138 142 142 143 145 146 146 147 150 152 153 154 156 158 160 162 163 Chapter Four Outline and Strategy of Strategic Utility Vehicles 165 Toyota Avanza/Daihatsu Xenia ◇Sales Trends ◇Production Trends Daihatsu Terios/Toyota Rush Daihatsu Gran Max 166 167 168 170 171 Suzuki APV Nissan Livina Series Mitsubishi Freeca/Adventure/Kuda (DFW) Mitsubishi Zinger/Fuzion Isuzu Panther/Hi-Lander/Chevrolet Tavera Toyota IMV ◇Background of the IMV Project ◇Platform Integration and Improvement of Local Content ◇Formulation of the Most Efficient Production and Supply System Globally ◇Quality Control ◇Sales ◇Next Generation IMV Isuzu D-Max/Chevrolet Colorado Nissan Frontier/Frontier Navara Mitsubishi Triton/Pajero Sport Mazda BT-50/Ford Ranger, Everest Tata Xenon Chapter Five Outline and Current Condition of Emerging Countries Globally 172 174 176 178 179 180 181 181 182 184 184 185 188 190 192 194 196 199 China: Tougher Competition in Compact and Basic Segments to Attract Middle Class Consumers 200 ◇Upper Grade Compact Vehicles Pushed New Vehicle Sales 200 ◇After Rapid Increase, Vehicle Registration and New Vehicle Sales Expected to Stabilize 201 ◇Industry Policy Aiming for Prevalence of Vehicles to General Households and Development of Chinese Firms 201 ◇New Relationship between Used Vehicles and Replacement Demands for Motorcycle and Agricultural Vehicles 202 Mexico: Diversification in Sub-Compact Market Lifts Vehicle Population to a Higher Level ◇Demand Lifter Shifts from Compacts to Imported Used Vehicles ◇Global Makers Separate Local Needs from Their Strategies in the Country ◇Product Proposal to Stimulate Market Potential and Supporting Measures 204 204 205 206 Brazil: Industrial Foundation Building to be a Pillar of Ultra Low Cost Vehicle Production ◇1L Car and Fuel Policy Pushed Market Growth ◇Signs of Diversification towards 4 Million Unit Market ◇Potential as an Export Hub of Modestly Priced Vehicles 208 208 209 210 Russia: Wealthy Class Led Market Recovery, High Expectation for Industrial Modernization in a New Growth Period 212 ◇Market Reached 3 Million Units with Strong Demand for Foreign Brand Vehicles 212 ◇Vehicle Market in a New Growth Phase after Troubled Period 213 ◇Development Policy Aiming at Fostering Domestic Industry on the back of Market Expansion 214