14 Jan 2018
3 min read
An automotive company that has been around since 1924, MG (Morris Garages) Motors is one of the oldest vehicle producers in the world. And it is one of the newest players in the Nepali automobile sector, having made its debut here two years ago, at the NADA Auto Show in 2016. “Any company that enters a new market has to first establish its brand name and then focus on achieving sales growth. It is through this strategy that awareness about our company is increasing in the market,” says Shresha Shakya, Project Manager at SLR Techno and Trade Pvt Ltd, the authorised distributors of MG Motors Nepal.
In this interview, Shakya talks with VMAG’s Abhinav Amatya about the processes involved in bringing a multinational company and its products into a market like Nepal as well as the ups and downs that most such companies go through in their infancy.
Early days in Nepal
The first vehicles that we brought here were the MG 3 hatchback and the MG 6 sedan, which are available in 1500cc and 1800cc variants, respectively. The newest addition to our lineup is the MG GS SUV, which was launched recently and is available in four variants—the 1500cc manual, 1500cc semi-automatic, 1500 fully automatic and 2000cc deluxe. There are plans to add to this current lineup, and the release of the new MG Crossover is also in the pipeline.
One feature that sets us apart from other automobile companies is that our hatchbacks come with 1500cc engines, something that no other company has offered in Nepal.
The MG 3 was the first model that was manufactured by MG Motors, after the merger of Nanjing Automobile, MG Motors’ parent company, with Shanghai Automotive Industry Corporation (SAIC), in 2008. The MG 3 model was followed by the MG 6 and then the MG GS (which had its worldwide release in 2015). Currently, MG Motors has multiple manufacturing units around the world, with the primary plant situated in Shanghai, and the assembly plant located in Birmingham, in the UK. Currently, plans to open up a new plant in Gujarat are also underway; the plant will begin operations from 2019 onwards.
Bringing in the vehicles
The vehicles that we offer to our customers in Nepal are all imported from the Shanghai unit. They are shipped from Shanghai to Kolkata and then transported in containers to Birgunj. Once they reach Birgunj, the vehicles are driven all the way to Kathmandu—a journey of almost 200 km. The entire delivery process takes about a month and a half.
To make sure that the vehicles are not damaged throughout the import process, we conduct a series of Pre-Delivery Inspections (PDIs). The first inspection takes place immediately after the vehicles are taken out of the containers in Birgunj. They are checked against a strict standard for performance issues, engine condition and cosmetic requirements. The second inspection takes place after the vehicles arrive at our workshops in Kathmandu, where our specialists scan for any technical inconsistencies in the vehicles that may have been caused by the long drive from Birgunj. The third and final inspection is carried out when a vehicle is being prepped before the final delivery to the customers. It is only when the vehicles pass through all these inspections that they are cleared for delivery. The process also ensures that the customers receive the quality that we have assured.
Initial obstacles in the new market
The initial obstacle that we faced when we first began our operations was the difficulty in establishing a presence in the market. This was because the market was already dominated by well-established Indian brands. Currently, there are in the market numerous automotive companies that provide customers with a vast number of alternatives, at various price points. Our vehicles carry a slightly higher price tag than the Indian brands that are so widely available. The MG 3 model is priced at Rs 39.25 lakhs, the MG 6 at Rs 65 lakhs and the MG GS can be had at between Rs 49.5 lakhs and Rs 82 lakhs. Thus the customers believed that these prices were slightly higher in comparison to the prices they were familiar with, for hatchbacks, sedans and SUVs. But I believe we are slowly changing the perception people have towards our brand.
Another challenge that we faced, and still face today, was convincing our customers that our quality is on par with the best automobile manufacturers. Since MG Motors’ manufacturing process is based in Shanghai, most customers were skeptical about the quality of our vehicles, primarily due to the misperception that Chinese products are not of high standard. However, quality is not an issue with our vehicles. MG Motors is a British brand that merely manufacture their automobiles in China. Think about this: Today, most electronic products, such as phones and computers, are produced in China. Yet, we do not question the quality of such brands. So, why should vehicles be treated any different? We are trying to change this opinion regarding Chinese-built products, through the use of print advertisements and social-media interactions.
The journey ahead
As we are just a new entrant to Nepal, we are currently solely focusing on promoting the products that we have. With our MG GS model, we plan to capitalise on the SUV trend that is prevalent in the market. As for introducing new models, we have plans to release the MG Crossover sometime in August 2018. The MG Crossover is a compact SUV (an SUV that is smaller than a mid-size SUV, such as the GS) that is perfect for the congested roads we have here in Nepal.
As for our outlets, we are currently operating out of only one outlet, which is in Kathmandu. In the coming weeks, we plan to expand our reach to outside out of the Valley, to locations such as Butwal and Pokhara.