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Business News/ Industry / Manufacturing/  Is it the end of the road for the Gypsy?
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Is it the end of the road for the Gypsy?

Maruti Gypsy’s sales to the Indian army may dry up after it fails to meet criteria for the latest contract

Maruti doesn’t want to upgrade the Gypsy or develop a new platform as the cost involved wouldn’t be justified by the numbers it could sell, according to a company official.Photo: Pradeep Gaur/Mint (Pradeep Gaur/Mint)Premium
Maruti doesn’t want to upgrade the Gypsy or develop a new platform as the cost involved wouldn’t be justified by the numbers it could sell, according to a company official.Photo: Pradeep Gaur/Mint
(Pradeep Gaur/Mint)

When it was launched in 1985, the sleek but still rugged lines of the Gypsy made it an instant hit, although that popularity never really translated into massive sales figures.

The numbers and the ubiquity came when law-enforcement agencies around the country and the armed forces began adding the sports utility vehicle (SUV), originally based on the Suzuki Jimny, to their fleets. The more agile, petrol-driven Gypsy was preferred over the slower, diesel-driven vehicles that had until then proliferated within the ranks of the police and the services.

But the sales of the Gypsy to the armed forces may dry up, according to five people familiar with the matter who declined to be identified.

Will this be the end of the road for the vehicle, given that its biggest customer, the Indian Army, wants a sturdier vehicle with more modern features?

When the Indian Army sought bids for the 800kg general service vehicle category, Maruti didn’t participate as it doesn’t have one that meets the requirements. Maruti’s Gypsy sells in the 500kg general service vehicle category.

These people said that once an 800kg vehicle is selected, it will start replacing the Gypsy.

Features being sought include airbags, anti-lock braking systems, air-conditioning, power windows, five doors and central locking—specifications absent in the Gypsy, which pretty much still looks the way it did in 1985.

“This is a part of the fleet modernization process of the army and the changes have been sought as Gypsy has become obsolete with time," said one of the people cited above. “The army changed the requirements in 2010 and they (Maruti Suzuki) did not participate for the 800kg class 4x4 general service vehicle tender as Gypsy could not meet the above mentioned new requirements."

The “army has never said that the 500kg category will not exist. Maybe both of these categories may co-exist. So to say that the army will stop procuring Gypsys will be far-fetched," he said.

However, the request for the proposal issued by the army has mentioned that “minimum requirement for general service vehicle" is 800kg. Currently, Maruti’s Gypsy is sold in that (500kg) category.

A Maruti Suzuki spokesperson, responding to a detailed questionnaire, said, “We have supplied over 27,000 Gyspsys and continue to serve the Indian Army." He didn’t respond to other questions sent by email.

The Gypsy, along with Mahindra’s MM550, was inducted into the Indian Army in 1985 and Maruti has been selling roughly 3,000 units a year to the armed forces ever since. Maruti has supplied more than 27,000 Gypsys to the army, a company spokesperson said.

A Tata Motors spokesman confirmed that it has bid but declined to give further details. A Mahindra and Mahindra defence division spokesperson declined to comment on the matter. An email sent to the Nissan India spokesperson declined to comment. Emails sent to the spokespersons of the army and defence ministry remained unanswered till press time.

While Mahindra is said to be sending a prototype based on its Scorpio SUV, the Tata Motors’s prototype will be based on the Safari platform. Nissan, participating in a defence procurement bid for the first time in India, will send a prototype based on its X-Trail SUV. There is an old Indian Army connection with the Japanese company, however, through the P60 SUV that Nissan introduced in the 1960s. It was modified into the Jabalpur Ordnance and Guncarriage Assembly—Jonga for short.

Price bids for the Indian Army vehicle tender will be opened after technical clearance is given to the prototypes. Testing will begin by the end of this month after the companies submit their sample vehicles by 15 April.

“The tender will be awarded to the lowest bidder," said one of the people cited above. “It will be a phase-wise purchase and the army will replace its entire fleet of Gypsys in some years. However, the new general service vehicles will only be a part of the army from 2017 as the process of bidding and placing orders normally takes three-four years."

The army will gradually stop procuring Gypsy SUVs and the vehicle will eventually be phased out, the person said.

The Gypsy’s exit from the army had already been on the cards, said Deba R. Mohanty, chairman and chief knowledge officer, Indicia Research and Advisory. “I presume that Maruti may not be meeting the new requirements. Having said that, I think it will be a huge order and augurs well for the Indian companies involved in it."

Other requirements that the Gypsy won’t meet include the stipulations about being diesel driven, having a minimum 120 horse power, compliant with Bharat Stage (BS) III and BS IV environmental norms and weighing 800kg or above, apart from climbing ability.

Maruti doesn’t want to upgrade the Gypsy or develop a new platform as the cost involved wouldn’t be justified by the numbers it could sell, according to another company official.

“The numbers that we sell to the army are substantially low as compared with our other models," said the Maruti official. “Hence, it does not make sense to invest in developing a new platform altogether specifically for the army. We have enough demand coming from the commercial car market and the focus is to meet that demand."

Also, Maruti doesn’t have a powerful diesel engine in its portfolio that could compete with those of the Safari or the Scorpio. In India, Maruti gets the 1300cc-diesel engine that it uses in several vehicles from Fiat SpA. Developing a new platform for a vehicle costs about 800- 1000 crore, according to experts.

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Updated: 03 Apr 2013, 10:56 AM IST
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