Renault launched the Duster in India last year and it immediately became a strong seller. The response to the Duster was so good that the compact SUV overtook India’s best selling SUV, Mahindra Scorpio, to become the segment’s best seller. All was well for Renault until Ford crashed the French automaker’s party with the launch of the EcoSport. Ford not only undercut the Duster’s price by a cool $3000 but also offered way more equipment, helping them to get 50,000 orders in a matter of just two months.
Ford has launched the EcoSport in Europe, although in limited numbers. The EcoSport won’t be sold in the U.S. as the vehicle is too small for that market. The main markets for the EcoSport are Brazil (being sold since 2003), China and India. The EcoSport is basically a jacked up Fiesta with high ground clearance as the underpinnings, mechanicals, engines and interiors are all the same.
Renault and Nissan badge engineer products in India but to little success. After seeing the tremendous response to the Duster, Nissan has decided to bring their own version. The car you see on this post is the Terrano which is nothing but a Duster underneath with cosmetic changes. Nissan plans to sell the Terrano at a $1000 premium over the Duster in India. Doesn’t seem like such a smart move as sales of the Duster are falling so why would anyone pay more to buy the same car with a different badge?
Faisal Ali Khan is the editor of MotorBeam.com, a website covering the automobile industry of India.
Is Ford making money considering the Duster is produced in cheap 3rd World countries and has less equipment?
Ford is building the Ecosport in Thailand, India, and Brazil. Shouldn’t be too expensive to build.
They have heavily localized content of the EcoSport, that is the reason why the launch was delayed by more than a year!
It sounds like Renault is trying to make money, or break even, while preserving market share by cutting the price of the Duster to be in the ballpark, but Ford looks like it’s trying to increase market share in a large and growing market, whether it makes money or not. Either that or Ford has a magic formula for lower costs of production. If there’s no magic formula, Ford can’t undersell the market forever, and Renault is smart not to match Ford’s pricing.
I’m not really sure how much cars cost in India (for some reason many poor coun tries have much higher car prices than the US), but assuming Dacia is at the lwoer end of cost, undercutting by $3K is quite a bit, especially with more equipment.
Ranault also builds the Dacias in large numbers all over the world, so their development cost and scale of production should be pretty good.
does India tax owners based on the engine displacement? if so, they might be comparing the 1.0l Ecosport vs. the 1.6l Duster.
1.6-litre Duster doesn’t sell. Renault largely sells the 1.5-litre diesel.
The EcoSport is sub 4-metre and the excise duty on the car is 12$ against 24% on the Duster.
” Doesn’t seem like such a smart move as sales of the Duster are falling so why would anyone pay more to buy the same car with a different badge?”
Well, what does GM do with Caddy?
What does Ford do with Lincoln?
Toyota with Lexus and even Nissan with Infinity?
Also, this is an important aspect of some blogs and articles I see is brand status. Brand status in a market.
Why shouldn’t Nissan be perceived as a better product than Dacia? Some countries perceive Caddy as a better product than some German marques.
It all about what a particular market perceives. How a product is marketed has a lot to do with this and of course personal income.
I would think any person who owns even a sh!t box in India would be classed by many as affluent.
Gold star to Big Al, extra homework for Faisal Ali Khan.
Aside from the GM/Caddy; Ford/Lincoln; Toyota/Lexus examples, there’s the whole bloody Volkswagen Group showing the world how to charge more for a ‘better’ badge.
The massive growth in the Indian middle class, and the brand focussed aspirational purchasing that goes with a growing middle class (see also: China) is exactly why Renault/Nissan have waited until Duster sales have slowed before releasing the Terrano.
I am well aware of what GM/VW do. Can you look at the Jetta/Octavia, Polo/Fabia, Vento/Rapid, Q7/Cayenne/Touareg and say they are the same car. NO. Because they have different styling.
The problem with the Terrano and Duster is that the changes between them is too minor, you can see the pics, isn’t that a Duster. Nissan has also removed a couple of features on the Terrano, even though it costs more.
Also in India, Renault is perceived as a premium brand, vis-a-vis Nissan. It’s because Renault re-badged the Micra (as the Pulse) and Sunny (as the Scala), pricing it at a premium!
Oh, the front end of the Dacia is fugly, it would be worth a little more cash for the Nissan:)
to western eyes the Nissan is a better looking car
it loses the goofy-ness of the Duster… i think for the nissan name and redesign it costs $1,000 more for $100 added value
i doubt it will ever come to most western markets (outside of the UK) as we have established that a Korean or cheaper Japanese CUV is around usd$25k with the chinese under $20k usd… there’s no room for a CUV cheaper than a Qashkai/Dualis
@TonyJZX
When I was in France there were multitudes of the Dusters. I pointed this out to my cousin and he didn’t realise there were so many.
renault being a french company i wouldnt have expected anything less
i think its in germany and spain and all the EU really since France is the 2nd biggest economic power in the EU
its just western english speaking provincialism on my part
The Duster still has a waiting list in the UK and some colours/options are still unavilable in RHD because they can’t meet the demand for the much bigger LHD market.
Cancelled orders sitting at the dealer are still commanding a premium (or, at least, the sticker price shows a premium) because they’re available right now.
I see a massive depreciation cliff coming but they’re great cars so I’m waiting until then to grab one for cheaps.
For the price in the UK, it’s a bargain, but its overpriced in India, considering its made here completely and exported to the UK.
The Terrano looks sort of like a 3/4 scale previous-generation Pathfinder, only without the goofy high-mounted rear door handles.
They have taken some design cues from other Nissan SUVs. There is a bit of X-Trail in the front too (old X-Trail).
If that USD3K price difference is accurate, it appears Ford is trying to win share rather than make substantial profit. Not a bad move in market such as India where customer loyalty can deliver years of repeat sales and positive family recommendations can generate yet more buyers.
There’s also the point that the EcoSport built in India will be produced in the same factory as the Fiesta it’s based on, which could cut costs, rather than the Renault/Dacia Duster, which although being related to an early (second-gen?) Clio has some unique parts on it that could add cost.
@TonyJZX – the Duster and other Dacia models are sold as a Renault in all European markets as it was decided that the Dacia name wouldn’t be perceived well. This was particularly true in Russia, where Dacia produced (crappy) cars in Romania for distribution throughout the Communist Bloc.
The EcoSport is cheaper as it falls under a lower excise duty bracket.
The Duster is also heavily localised and exported to the UK.
The Duster has actually a lot in common with the Sandero/Logan.
Chassis/powertrains of course but even front doors for example are from the Sandero, much of the dashboard too. And being low-cost built, I’m sure they have great margins.
Dacia is said to have double digit operating margin in Europe. And when I see it integrated to the Renault range elsewhere (and priced with a premium), I’m sure the profits are becoming really important.
If you count all the cars derived from the Logan, it sits in the world top 10. Yes, it’s a money making machine for Renault/Nissan.