F1 2018 – Sporting regulations

The world awaits yet another season of the biggest motorsport event – F1 2018, the drama unfolds, like every year, with a slew of regulations. After all what would F1 be without these rules and regulations. I personally see these as challenges thrown at every manufacturer on that starting grid to push the envelope of their already advanced machines. These regulations are introduced or so called changed in many instances to catch up with the changing tactics in terms of technological prowess, or sometimes to introduce new technology (usually safety related tech) or simply to ward off a potential problem that might occur down the line. So lets get our hands on the changes that the FIA has introduced this year and how it changes the fortunes of some of the teams and manufacturers.

For starters I would like to split the regulations rule book into 2 parts like the FIA does –

  • Technical Regulations – Like the name suggests this basically covers the machine (the car) and its systems. Basically this is the book that the design engineers and staff refer to before and during the race. This deals with technicalities like dry weight, aerodynamic downforce, the KERS systems, braking systems, etc.

  • Sporting regulations – In lay man’s terms this rule book deals with how the race is supposed to be run. This is basically the written law on how the drivers and teams should act during a race. Primarily this is the domain of the race engineer who constantly makes strategies within the boundaries of these regulations and instructs the drivers under different circumstances of the race

There is not many changes in the sporting regulations. The only small change is in the safety car restarts where the driver gets to choose between a standing start or a rolling start offering more flexibility to the teams. The biggest changes for next year which is of interest and will impact the sport are as follows –

Three Engines per season

This is the biggest change F-1 will see this year. I will term this as the most stringent engine quota that the sport will see. Each car will be allowed to use only 3 power units over the course of 2018 season. That means teams will get to use just 3 engines for a span of 21 races. This puts immense pressure of the reliability of the engines that engine manufacturers will have to build. To give you some background, back in 2004, FIA allowed the use of one engine per weekend which was reduced to 5 engines for the whole season in 2014 and four in 2015. The advantage of this move is reduced costs as manufacturers will push to make the engines more reliable, which maybe a concern for a few manufacturers. The downside which even I agree to is that drivers will now be asked to nurse their engines rather than drive flat out like they used to. Driver’s aren’t particularly happy with this move but I feel they aren’t happy since May 13th 1950 when the FIA came into picture!

Grid penalties changes

This is an obvious step for the FIA. With the 3 engines per season rule, God forbid if the drivers have to change their engine they will have to face grid penalties. I personally found the last year’s penalty system confusing, however this year FIA has gone ahead and tweaked it to some extent. This is, needless to say, an alteration in the sporting regulations. The detailed penalty system can be downloaded from this link – https://www.fia.com/regulation/. To summarize if a driver collects a 5 or a 10 place penalty based on the component changed. If they replace a second component he gets a 15 place penalty and he will automatically be sent to the back of the grid. In case there are multiple drivers who are attracting this penalty then the line-up will be decided by the FIA based on when the FIA was informed of the offense. This year the race stewards also get the power to issue penalities even if it’s not detected on auto detection system (learning from Vettel’s race in Chinese GP)

Tyre compounds

This year fans will be able to see more colours of tires around the pits. Pirelli will be expanding the array of dry weather compounds to 7 from earlier 5. They have basically added 1 compound each on either end of the spectrum – superhard and hypersoft. I personally feel the super-hard tyre will just be a catalog addition and will be used by teams as a last resort. This is primarily because in reality teams are pushing for softer compounds across the board. This point will be evident from the fact that Pirelli has announced that in 2018 every compound will be one level softer from 2017. So for example the medium compound tyre in 2018 will be comparable to soft compound in 2017. In such scenarios, it’s a wait and watch for the superhard tyre and will be interesting to see how teams will come up with that extra downforce as Pirelli is anticipating. This hence will be restricted to high energy circuits like Germany.  It will really be interesting to listen to the commentary this year (pun intended).

The colour palette for 2018 is –

Super-hard – Orange, Hard – Ice blue, Medium – White, Soft – Yellow, Supersoft – Red,  Ultrasoft – Purple, Hypersoft – Pink

Like every year 2018 is going to be an interesting season. Alas FIA gave a miss to India this year as well. I am eagerly waiting for those 5 lights to go off on 25th March in Melbourne and see how teams fare this year. 10 teams, 20 talented drivers one sport!

(Author’s Profile:  Manu Sasidharan. Am a hardcore petrol head, an auto enthusiast and an amateur designer. I have been in close touch with the industry for a long time and am abreast with the action in the automotive sphere. Driving is my passion and combined with a love for travelling makes me a nomad by nature. On the education front, I have done my Engg in Electrical and Electronics from Cochin university and my Management studies from Symbiosis Pune.)

Mahindra THAR — India’s own off road champion!

Launched in the Indian market on October 4, 2010, This compact and mid-size four-wheel drive off-road Jeep CJ-like SUV has always been appreciated for its brilliant off-roading capabilities, rugged and masculine robust body-built and legendary jeep styling. This also has been voted one of the top 10 SUVs available in the Indian market.

Let’s see the volume trend for past 5 years –

Monthly Sales Data (2015-2017)

Thar earned a lot of reputation in its segment and won the hearts of many with its off-roading capabilities but what could be a concern for Mahindra is the stabilizing volumes Month on month and has not been able to give any significant volumes addition. Rather we can term Thar now as a Brand building vehicle in Mahindra’s portfolio.

Year 2013 2014 2015 2016 2017
Average Monthly Sale 637 729 742 510 588

Mahindra Thar which is facing almost No competition in its segment but has the closest competitor in terms of sales volume, despite of New (Thar) vs. outdated design Maruti Suzuki Gypsy which doesn’t offer a diesel engine, power steering but still stands as the closest competitor of Mahindra Thar! In the other hand The Thar has a rugged design, masculine robust body-built, while the Gypsy has conventional styling and outdated design. Still Gypsy brings good numbers to Maruti Suzuki and has been able to give competition to Mahindra Thar in terms of sales volume.

Let’s look at the comparison:

The total volumes of Thar models are about 7,700 units a year and of which 65 per cent comes from DI model. Mahindra expects the incremental sales go come from CRDe version in the near future with changing aspirations of urban people and launch of new Thar with more features. Best of Luck for the off-roader!

Swift at 35!

Maruti Suzuki has officially opened bookings for the new Swift. The new Maruti Suzuki Swift can be booked for a token amount of Rs 11,000. The car was also showcased to media today. We decided to track the evolution of Swift as a model and also assess its sales statistics in the Indian market.

Tracing the venerable vehicle back to its roots,the first thing we noticed was the Swift badge has been slapped on a lot of vehicles over the past 35 years! Not just talking about its four generations,each generation itself contains a dizzying range of body styles and engine and transmission options ,not to mention the variants produced for the Japanese and the Americans and other foreign countries.

It all started with General Motor’s M Platform. The GM M platform was the designation used by GM for the platform that underpinned the second and third generation Suzuki Cultus and its offspring (Swift). It was designed at GM’s Technical Center in Warren, Michigan, USA. Suzuki designed all the engines, drivetrains and actual body initially. From 1985 through 1989, all models were imported from Suzuki’s facilities in Hamamatsu, Japan. From 1990 on, all North American M-cars were produced at CAMI Automotive in Ingersoll, Ontario, Canada with the exception of the convertible and turbocharged models which were imported from Japan.

Suzuki Cultus (rebadged as Swift outside Japan)

GM did not find the project profitable and the unfinished design was sold to Suzuki. The project was completed by Suzuki and they launched the car as the ‘Cultus’ in the Japanese market. The Swift name plate was used by Suzuki in the markets of Austallia and the Newzealand. Even GM badge engineered it to launch it as Cheverlet Sprint in North America.(The third generation M platform was only sold by Suzuki as the Suzuki Swift in North America as Suzuki decided to create their own Swift to market around the world.)

This is how the first Gen SWIFT looked like!

The First generation Swift was introduced in the year 2000 as a replacement for the Suzuki Cultus. Outside Japan, the “Suzuki Ignis” name was used! Both three- and five-door hatchback body styles were offered, although the three-door was not offered as part of the regular lineup in Japan.

2nd Gen Swift!

The Second generation of the Swift marked a significant departure with the previous Cultus-based models, with Suzuki redesigning the vehicle as less of a “low price alternative” subcompact and more of a “sporty” subcompact hatch. The Swift’s design and driving characteristics focused on the European market with its chassis refined through a road-testing program across Europe.

3rd Gen Swift

The Third generation Swift is currently in sale at the Indian market. It had its wheelbase extended by 50 millimeters over the previous second generation and has many visual updates. While the new car looks different from the old one, its design is an evolution of the radical second generation styling with a longer and more rounded appearance.

4th Gen Swift

The Fourth generation Swift debuted in Japan on 27 December 2016. The hatchback is built on the ‘HEARTECT’ platform which made its debut in 2015 and is the same lightweight platform used for the production of hatchbacks Baleno and Ignis!

Sales Statistics of Maruti Suzuki Swift in India –

  • ~18 Lakh Swift’s has been sold in the Indian soil till date in past 13 years
  • Swift saw a downward trend since 2015 (post the launch of Nexa Baleno). However, it still sells a whopping 1.67 Lakh units/year!
  • The upcoming Swift will carry the same lightweight platform as the current gen Baleno / Ignis.

Swift at 35 years, clearly has carried on the legacy of the Suzuki and this generation will carry on for more years. Swift has made major contribution in making Suzuki a true global car manufacturer and making Suzuki carrying on pole position in India. Surely it is the most anticipated launch of the year and the buzz will explode very soon.

Data Source: Wiki

(This article is written by the latest addition in our team – Gourav Saksham, a dentist by profession and a Petrohead by passion. You can connect with him at gouravsaksham@gmail.com)

Indian Luxury Car Market

Mercedes Benz was the first luxury car maker which has shown confidence in Indian market and set up assembly plant near Pune after Indian Government has allowed foreign auto makers to set up factory through direct investment route in early 90s. First car launched was E-Class, it was W124 series which was then quite dated in global market as W210 series was ready for launch in Germany. Mercedes corrected the course in 1997 by launching W210 Series E-Class, followed by S-Class (2000), C-Class (2001) and M-Class (2002). For almost 10 years Mercedes was the only Luxury car maker in India. By 2004 global economy was very buoyant, India too was riding on the wave, then other luxury car makers decided to set up shop in India and offer expensive toys to emerging wealthy Indian to showcase their new found opulence. Since then only brand which got discontinued was Maybach, a brand re-introduced by Mercedes Benz to compete against Ultra Luxury brands – Rolls Royce and Bentley. This happened because Maybach (2002-2012) disappeared from global market, as it failed to catch imagination of people across the globe, as it doesn’t have heritage to boast of against the prominent competitors. Bugatti, a member of VW family, too has introduced its hyper car Veyron, which claims to be one of the fastest street legal car in the world. It also happened to be most expensive car sold in India till date, if you don’t consider the armored version of conventional models from other luxury car maker. Veyron has been replaced by Chiron globally and is yet to touch Indian shores. Tesla and may be Alfa Romeo are the only brands which can be expected in near future to join the luxury club.

Country of Origin

Britain has most numbers of luxury car brands to offer in India, ironically, none is owned by the British now, which you will see next. Large volume of luxury cars comes from German stable and ultra-sports car arena is dominated by Italians. Safety obsessed Swedish car maker Volvo too is gaining market share as it has recently started assembly operations at Volvo Trucks’ plant near Bangalore. Company from Far East is the most recent entrant.


Whatever car you fancy about with your wealth, VW here has widest range of brands to offer under its umbrella. BMW can have similar spread if it acquires Aston Martin. Some mass market brands like Tata and Geely got lucky with the acquisition of luxury car brand JLR and Volvo respectively.

Social Stratum

Luxury car maker have their own pecking order and fascinatingly have an upper price ceiling too. When you consider other rich man transportation toys like private Jetliner or Yachts, sky is the limit. But when it comes to cars, the most expensive car you can buy from a showroom is either Rolls Royce Phantom or Bentley Mulsanne, even if you have all the wealth of the world. Here we are excluding cars which are expensive in first place by default rather than by design – Hyper Sports cars (primarily focused on high performance, sometime made up of expensive material like carbon fiber, Titanium, and not meant for everyday ride due to stiff suspension setup, seating position and lack of storage space), limited editions (because you cannot order when you wish to), armored vehicle (conventional vehicle becomes expensive), custom made Limos (elongated version of existing cars) and vintage cars (vanity value). Ever thought on these lines or is this has some correlation with Maybach’s failure? If you have an answer, then please write to us. *(Ex-Showroom Price Range in ₹ Crores)

Luxury Car Sales

Till 2006 Mercedes has enjoyed its monopoly in Indian luxury car market. But in last 10 years all the three German (Audi, BMW and Mercedes) luxury car maker got the chance to wear #1 crown, turn by turn. Change in design language, CEO’s aggressiveness, new product launch, especially smaller and more affordable ones, were key reason for shuffling of top deck. Unlike mass market segment where Maruti and Hyundai have had strongly held #1 & #2 rank and seems they would be continuing to do so, Luxury car market will see new leaders with every successful new product or new generation launch.

2017 happens to be the best year for the luxury car market in India where some companies are rejoicing with the sales growth they achieved over preceding year. Almost all are unhappy with September 2017 GST rate revision, which they feel has dampened the growth, and in future it will remain so. Yes tax does have an impact but it has to do more with the wealth and prosperity of the masses for luxury market to grow rapidly. Let us think from a different perspective. Till late 70s India and China had similar GDP size and in today’s date have similar population. Indian luxury car market size is close to 40k units now, but in China, Audi alone, sold more than 5 lakh cars (46k monthly average) in 2017! 3 decades of double digit GDP growth has made Chinese wealthier than Indians. With India’s current GDP growth rate it will take decades to reach such exponential growth in Indian Luxury car market.

Overall market

If you look at the overall passenger car market, luxury car penetration is mere 1%. Here we did a very conservative estimate of revenue and found that the revenue and tax contribution share is relatively high. When you read these figures just keep in mind, that these are very conservative estimates for illustration purpose only, based on certain very broad assumptions. Actual figures based on variant and fuel type of car and revenue from after sales spares can be on higher or lower side (may have wide variation).

Revenue = ∑ [Number of individual model sold x price of lowest variant (excluding indirect tax-GST/VAT/Excise)]

Halo products

There is handful of niche product from non-luxury car makers which falls into price territory of luxury cars. These are all halo products and are not sold in large volumes in India but are meant to showcase the heritage or technological accomplishment of the company, and add to the brand identity. Since all are CBU import, they are quite expensive for the badge they have on front grill.

For example Fiat 500, in late 50s it used to be cheapest car in Italy and made owning personal car a reality for the masses, similar to what Maruti 800 did in India since its launch in 1983. 500 signify the 479 cc engine it used to have then. Now Fiat 500 has assumed an iconic status. It still has the retro styling and borrowed its underpinning from humble Fiat Panda.  In white color it looks more like a lovely pet mouse.

In India, it was first launched in 2008 and was powered by a 1.3L 90 bhp diesel engine and didn’t do well and was eventually discontinued in 2010. It was re-launched in 2015, this time with Abarth badge on front grill and a new name “Abarth 595 Competizione”, with much powerful 1.4L T Jet petrol engine pumping out 160 bhp. 595 signify the original retuned car of 60s which came with a 595cc engine and Abarth is to Fiat is what AMG is to Mercedes Benz, an in-house tuning company. Company claims that it can do 0-100 kmph in less than 8 seconds and clock a top speed over 200 kmph.

Despite the fact that every automotive brand has an upper price ceiling which is psychologically ingrained in the mind of customer, some of these high priced halo products are doing well.

EDIT (Clarification on the comment raised by a reader):

“Shouldn’t you include Jeep as a luxury brand under FCA – given the stratospheric price tags on the Wrangler and
Cherokee in India? For that matter, even Ford for its Mustang!” – SUBHABRATA BAKSHI (January 17, 2018 at 5:53 am)

In first draft of the report, Jeep was there, where you have mentioned, but after lot of deliberation it has been
removed. Major reason was starting price point for the brand. It is apparent that in India, luxury car prices start from 28 lakhs, that too for hatchback. But price of Jeep’s compact SUV – Compass starts at a price point of ₹ 15 Lakhs which will go down further with launch of Jeep Renegade, likely to be priced around 12 Lakhs. So, from pricing perspective Jeep is essentially straddling way too much in India. Reason is both Grand Cherokee and Wrangler are importedproducts, and thus attract high custom duty (125%). Pricing has very crucial psychological implication in luxury brand positioning. As luxury product are meant for indulgence, exclusiveness and its more of a conspicuous consumption.

To get doubts clear, before publishing this report a visit to US website of the Brand in question became essential and
there, Jeep though an iconic brand, is not regarded as Luxury brand at all. For apple to apple comparison and price
reference, those products were considered which are on sale in India too.

Grand Cherokee shares the platform with Mercedes Benz M-Class, which is now known as GLE Class. This is because
of erstwhile marriage of Daimler and Chrysler. Despite platform sharing, look at the price difference of both the
products. Price of Grand Cherokee starts way below the cheapest Mercedes SUV on sale in USA. With new marriage,
Fiat’s Boss has hinted that next platform will be shared between Jeep and Alfa Romeo.

In India brand is in nascent stage. Only time will tell if market accepts the premium price demanded by Jeep for these two products, which has huge bearing of custom duty. That will be really an interesting case study from brand and pricing perspective.
Prices may come down in future, if ever, Jeep decides to assemble both the products in India. In fact, India is fourth
manufacturing base for Jeep across the world outside USA – Brazil, China and Italy being others. Still as per latest
media report Jeep is not planning to locally assemble these two products.

I came across an interesting case study on Consumer Psychology and pricing, just thought of sharing it with you.

A Black T-Shirt
The black T-shirt for women looks pretty ordinary. In fact, it’s not that different from the black T-shirt sold by Gap and by Swedish discount clothing chain H&M. Yet, the Armani T-shirt costs $275.00, whereas the Gap item costs $14.90 and the H&M one $7.90. Customers who purchase the Armani T-shirt are paying for a T-shirt made of 70 percent nylon, 25 percent polyester, and 5 percent elastane, whereas the Gap and H&M shirts are made mainly of cotton. True, the Armani T is a bit more stylishly cut than the other two and sports a “Made in Italy” label, but how does it command a $275.00 price tag? A luxury brand, Armani is primarily known for suits, handbags, and evening gowns that sell for thousands of dollars. In that context, it can sell its T-shirts for more. But because there aren’t many takers for $275.00 T-shirts, Armani doesn’t make many, thus further enhancing the appeal for status seekers who like the idea of having a “limited edition” T-shirt. “Value is not only quality, function, utility, channel of distribution,” says Arnold Aronson, managing director of retail strategies for Kurt Salmon Associates and former CEO of Saks Fifth Avenue; it’s also a customer’s perception of a brand’s luxury connotations.

(The article is written by the Newest Pundit on the team – Rohan Rishi. You can connect with him at emailrohanrishi@gmail.com)

Luxury Car Sales for last 10 years!

Yes, we have been able to collate the data for the last 10 years (2008-2017)! The Luxury Car Industry has grown >5 times in the last 10 years in the Indian subcontinent. Though the overall annual volumes is less in the country, the continuous growth in the segment has attracted many Luxury carmakers to make their presence here. To highlight the significance of Indian Luxury Automotive segment – India is one of the first few markets in the world where the Lamborghini Urus is being launched. Even with a ticket price of Rs.3 crores (Ex-showroom, Delhi), company claims that they have exhausted almost all the Lamborghini Urus SUVs allotted for India, for the year 2018!

In the consolidated Sales of past 10 years, Mercedes Benz take the Top slot with the sales of 88,260 units. BMW stands second with sales of 70,209 units. Audi within a smaller span came close to BMW and sold 67,887 units. It is important to note that while Mercedes is present in the country since more than 20 years, BMW and Audi have completed just half the tenure of Mercedes! BMW’s rise was phenomenal – It was able to dethrone Mercedes as the No.1 luxury OEM, just within 3 years of its presence in India. Audi’s rise has been similar – Though it was founded in 2007, it jumped as the No.1 Luxury Car maker  by 2013 and toppled both BMW & Mercedes. However, the spur of new launches in 2015 drove Mercedes Benz back to Numero Uno position! In 2017, Mercedes Benz commanded a market share of over 39% and is going strong year on year. It also achieved its all time highest sales volume of 15,300 units in 2017!

The ranking table has been extremely volatile over years and the same is depicted in the above table. Also attached here is the latest Ad from Mercedes Benz highlighting the No.1 Luxury OEM for 3 years in a row –