Tata Motors pre-empts Bajaj Auto’s quadricycle with Magic Iris

Tata getting ready to launch Magic Iris ahead of Bajaj's launch of the RE60, the country's first quadricycle

Shally Seth Mohile
Updated19 Apr 2014
There remain some grey areas in Tata&#8217;s plans to have a four-wheeler ply on a three-wheeler permit that could see the revival of hostilities on the regulatory front. Photo: Ramesh Pathania/Mint<br />
There remain some grey areas in Tata&#8217;s plans to have a four-wheeler ply on a three-wheeler permit that could see the revival of hostilities on the regulatory front. Photo: Ramesh Pathania/Mint

Mumbai: The so-called quadricycle spat between Bajaj Auto Ltd and Tata Motors Ltd seems set to revive with the latter getting ready to launch the Magic Iris, a three-seater auto-rickshaw replacement, albeit with four wheels, ahead of the former’s launch of the RE60, the country’s first quadricycle.

Tata Motors wrote to the transport departments of Delhi and Maharashtra seeking permission for the four-wheeler to ply on a three-wheeler permit. Delhi’s transport authority has already approved this, according to the application filed by the company in Maharashtra.

Bajaj Auto has been working with various state governments and the Union government, which is yet to announce the final specifications for quadricycles, an entirely new category of vehicles.

After a bruising battle, with his company on one side, and nearly all other auto firms on the other, Rajiv Bajaj, managing director of Bajaj Auto, convinced the Union government in December to allow a new category of vehicles, a sort of midway link between the auto-rickshaws popular in India as a means of public transport, and cars.

The Tata Motors launch would suggest the fight has moved to the market, although there are some grey areas in Tata’s plans to have a four-wheeled vehicle, which it calls a microvan, ply on a three-wheeler permit that could see the revival of hostilities on the regulatory front, too.

“It is not for me to say, but it does sound hilarious, doesn’t it?” said Bajaj in an email response.

If the Tata Motors’ plan succeeds, it could open up the market for other companies that have offerings similar to its own, although Bajaj was categorical that “vehicles that fail miserably both on customer benefits as well as financial viability” cannot “provide sustainable sales”.

Ravi Pisharody, executive director (commercial vehicles) at Tata Motors, confirmed that the company had written to state governments seeking permission to allow the Magic Iris, of which Tata now has a compressed natural gas (CNG) version, to ply as an auto-rickshaw.

Anand Tiwari, joint commissioner (operations) at the Delhi transport department, said he would not be able to respond on the subject before Monday because he has just taken charge of the department.

Analysts said that even as there is enough room in the market for multiple product offerings, Tata Motors’ plans might impact Bajaj’s quadricycle.

In the absence of a well-developed transport infrastructure in the country and increasing congestion in cities, demand for smaller, fuel-efficient vehicles that can cover the last mile will expand, according to Surjit Singh Arora, an analyst at Prabhudas Lilladher Pvt. Ltd.

The entry of Tata Motors into the segment with a vehicle that it has been successfully running in smaller towns could take the first-mover advantage away from Bajaj’s RE60, which is still awaiting clearances, Arora said.

Tata Motors launched five-seater and three-seater versions of the Magic Iris two years ago and currently sells 2,000-2,500 of them a month. The vehicles are popular in smaller towns and rural areas. Indeed, the permission from Delhi could open the gates for the vehicle in other cities, said S.P. Singh, a senior fellow at the Indian Foundation of Transport Research and Training.

Rajiv Bajaj isn’t worried, though.

“The RE60 is distinct from all three-wheelers and cars or vans that exist today because it’s the only four-wheeled vehicle that’s as light as 400kg,” he said. “Owing to its light weight, it delivers an unmatched 35km to a litre, emitting under 60gm per km of carbon dioxide. Equally importantly, that’s also why it can be sold at an affordable price.”

The Tata vehicle weighs twice as much as his, Bajaj added.

Mint has seen a copy of the application by Tata Motors to the Maharashtra transport commissioner. Mentioning the subject as “Approval for Tata Magic Iris CNG BS-IV for commercial application as passenger vehicle (motor cab three seater) for the state of Maharashtra”, the letter says: “The Iris CNG offers superlative safety, space, comfort, and all weather protection while meeting the strictest emission standards.”

The road to Maharashtra, however, may not be easy for the Iris. “We are still studying the various aspects. We are unable to decide which category it could fit in,” said P.D. Nikam, deputy transport commissioner of Maharashtra.

The specifications of the vehicle, said Nikam, neither befit a three-wheeler permit nor a taxi permit. The department has written to the Automotive Research Association of India, the government certification agency, seeking clarifications regarding the vehicle.

“Tata Motors is proposing the Iris as a replacement for three-wheelers. However, a big difference in the cost of an Iris and an auto-rickshaw could make the vehicle economically unviable,” said Nikam.

Priced at around 2.2 lakh, the CNG version of the Magic Iris is powered by a 611cc engine and weighs 680kg. It has four seats that can accommodate a driver and three others.

The price of Bajaj’s three-wheeler is 1.42 lakh in Mumbai (excluding taxes). Powered by a 175cc engine, it weighs 350kg and can seat four people—a driver and three passengers at the rear.

Bajaj’s RE60 is expected to be priced competitively at 1.5-1.9 lakh and will be available with two seating options—two at the front (including the driver) and two at the rear; and one at the front and three in the rear.

Bajaj’s quadricycle could face similar issues with regard to the permit. “The states will have to take a decision as and when the quadricycle is launched,” said Nikam.

“Each state has to determine” the kind of permit required for a quadricycle, Bajaj said.

The Magic Iris has been running in Assam, Bihar, Odisha and Punjab that do not require permits for three-wheelers (even if they have four-wheels).

In order to restrict the number of auto-rickshaws on the roads and check congestion, India’s 14 largest cities including Bangalore, Delhi, Chennai, Hyderabad and Mumbai, have made such permits mandatory for three-wheelers.

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