Aggressive pricing and the availability of both gasoline (petrol) and diesel engines are expected to help Tata generate sales of the new Nexon crossover.

IHS Markit perspective

• Significance: Tata Motors has launched its Nexon crossover in India, further intensifying competition in this segment.
• Implications: Priced aggressively, the Nexon will compete against the Maruti Suzuki Vitara Brezza, Ford EcoSport, Hyundai Creta, and Renault Duster.
• Outlook: We forecast that the model will garner sales of nearly 8,400 units in 2017, and volumes are expected to increase to 53,000 units in 2018.

Tata Motors has launched its Nexon crossover in India, further intensifying competition in this segment. In a statement, the automaker says that the model is the fourth product based on the "Impact Design" philosophy. The compact sport utility vehicle (SUV) is being made available in five variants and with two engine options covering both diesel and gasoline (petrol) fuel types. The 1.5-litre Revotorq diesel engine offers 110 PS of power and 260 Nm of torque, while the 1.2-litre Revotron gasoline engine generates 110 PS and 170 Nm. Both engines are available with 6-speed manual transmissions, while the automaker plans to launch an automated manual transmission (AMT) semi-automatic option at a later stage. The crossover is 3,994 mm long, 1,811 mm wide, and 1,607 mm high.

In the dashboard, the model features a 6.5-inch HD screen with a new user interface. Offered within the touchscreen infotainment system are features such as Android Auto, voice commands, and message readout and reply. There is no leather cover option even on the higher trims, but the model is offered with front centre armrest, sliding tambour door storage, and smart key with push-button start. The automaker has equipped the model with projector headlamps, LED daytime running lights, and LED tail-lamps. Tata Motors has decided to offer airbags as standard across all variants of the Nexon, a first for the company.

The Nexon will compete against the Maruti Suzuki Vitara Brezza, Ford EcoSport, Hyundai Creta, and Renault Duster. The vehicle is priced at INR585,000 (USD9,105) for the gasoline version, while the price of the diesel version is INR685,000 in New Delhi.

Outlook and implications

This is the fourth new model launch by the automaker in the past couple of years following the Tiago hatchback, Tigor sedan, and Hexa SUV. The model will compete in a growing segment where more automakers are launching products. Nevertheless, competition remains limited in this niche. Tata also has a slight advantage by offering both gasoline and diesel options for the Nexon. Maruti's Vitara Brezza and Mahindra's TUV300 are offered with only diesel engines and this is likely to help Tata. Being a sub-four-metre vehicle, the Nexon is helped by regulations that apply a lower rate of taxation to small vehicles.

Tata has also kept the pricing of the model on the lower side in comparison with its rivals. Again, this will help the automaker, which has regained some of the lost ground in consumer confidence in India. Like its peers, the Nexon is aimed at urban buyers and the level of refinement and equipment has a big impact on consumers' buying decisions in this market. The success, albeit moderate, of Tata's new product launches to date has helped it get onto the consideration lists of buyers. Nevertheless, it will be important for Tata to capitalise on any early demand it receives for the model.

IHS Markit forecasts that the Nexon will garner sales of nearly 8,400 units in 2017, while volumes are expected to increase to 53,000 units in 2018.

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