Rajiv Chhaba, president and managing director at MG Motor
India holds out a different perspective. “The sentiments can be against certain products which have to be imported, but this is a British brand, made in India. If anything, the current situation tells us to do more and more,” says Chhaba alluding to an aggressive localisation of the models and stepping up all its activities—offering direct and indirect employment, ensuring gender diversity at its plants, engaging in community services and supporting start-ups.
Brand Hector is not insulated from the rapidly growing anti-China sentiment in the country, but some experts said that it may be erroneous to look at MG Hector
as a Chinese brand.
“It’s a British brand owned by a Chinese company and in some ways is like JLR being a British brand, owned by an Indian company,” said Avik Chattopadhyay, founder at Expereal, a brand consulting firm. JLR buyers are drawn to the brand for its British manufacturing, design and legacy and the Indian connection is not as deeply embedded into its identity.
Ditto for Swedish auto brand Volvo, which also has a Chinese parent (Geely).
“More than anything else what matters is the brand promise you are delivering. I like to believe we have been offering a great value proposition on technology and cost of ownership,” said Chhaba.
Chaba wants to play down the impact of the tensions at the border, but it is affecting the day-to-day operations of the company. For instance, the 100 per cent inspection policy on consignments from China, Chhaba agreed, has added another layer of complexity to an already complicated supply chain situation. MG Motor presently has a backlog of 12,000 units of Hector due to a slow ramp up of the model on the back of supply chain issues.
Expereal’s Chattopadhyay says if the geo- political situation between the two countries continues, it will likely make things worse. And not just in terms of a broken supply network but also in the way people perceive the brand. Owning a vehicle of China origin that costs Rs 15-20 lakh, when there are options available in the market, may not go down too well.
A car is always seen as an extension of one’s personality and it needs to be seen if buyers will be comfortable making such a statement with a brand owned by a Chinese company.
Ravi Bhatia, president and director at JATO Dynamics, a global consulting firm, says that the situation is just a short term blip for the brand. “Globally, car brands changing ownership is a common phenomenon. People buy into a brand and are not concerned about ownership,” he said. Also he and many others point out that Indian consumers are primarily value seekers and if MG Motor is able to deliver on its promises, be it the tech framework it claims to have built into the model or an attractive price point, Hector may find itself home and dry.