A $7,000 SUV? What American Automakers Can Learn From This Indian-Market Renault
They demand bespoke solutions that have been "frugally engineered" for them.
The "frugal engineering" gospel is preached by Chennai, India-based digital-tech services provider Hinduja Tech. I first learned of this company during a live broadcast of Autoline Detroit featuring "lean design" guru Sandy Munro. He was ostensibly there to discuss his company's teardown and cost analysis of the Tesla Model 3, but he mentioned that he currently had a Renault crossover in his shop that sells in India for $6,671, and his first-world clients all mistook it for a $12,000 car. After the show, I begged to come see it, and Sandy invited me to meet the Hinduja team that helped engineer it.
Sure enough, the Fiat 500-sized 67-hp, 67-lb-ft 1.0-liter three-cylinder, range-topping Renault Kwid Climber in Sandy's shop looked spiffy in metallic blue paint accented with orange flourishes inside and out. It featured power windows and locks, A/C, a digital dash with trip computer, an 8.0-inch infotainment touchscreen with Apple CarPlay and Android Auto, a driver airbag, seat belt pretensioners, antilock front-disc/rear-drum brakes, a backup camera, and a rotary selector for the five-speed automated manual transmission. It's front-drive only, but with 7.3 inches of ground clearance, long suspension travel, and 80-series tires, it promises to tackle rough roads. Base 0.8-liter manual Kwids start at just $3,818.
Hinduja Tech won a bid to develop the Kwid (and its platform-mate, the Datsun Redi-GO) when Nissan's own price-slashing efforts at adapting a Japanese-market offering stalled out above $7,000. Hinduja's president of the Americas, Vijay Malik, discussed five cornerstones of his "frugal engineering" philosophy:
Engineering and purchasing must collaborate from the start. "Engineers never see 'ugly' in their babies, but purchasing folks can." His team sourced myriad off-the-shelf items such as hinges and latches from mass-market suppliers and engineered them into the initial design.
Seek common demographics. Rather than chasing economies of scale by using high-volume first-world (more expensive) parts, Hinduja Tech found scale by engineering for several entry-level markets, such as India, Indonesia, Mexico, and Brazil. The Redi-GO and Kwid body structures are engineered to accept one, two, or four airbags depending on the market. Key structural areas can be strengthened simply by swapping in different steel grades or "tailored blanks" to suit different crash compliance regulations.
Reassess design criteria. Global cars are developed for -40º Celsius temperatures when -20º C should be sufficient for these target markets. Relaxing internal requirements such as the amount of door sag allowed with 100 kg hanging from the latch to 1.0mm, instead of 0.5mm, saved another few bucks—as did carefully painting the underhood, hatch, and trunk area to eliminate trim pieces.
Simplify manufacturing. Early headlamp styling included Nissan's V motif, but stamping a fender to accommodate that design required additional, costly stamping operations. All Redi-GO/Kwid panels can be formed in three die strikes or fewer.
Design/develop "in the tube. " Extensive computer-aided design and preliminary testing helped cut engineering costs by 30 to 50 percent and reduced time to market by a third.
Frugal doesn't have to mean cheap. When you loudly tout "WORLD'S CHEAPEST CAR," as Tata did with the sub-$3,000 Nano a decade ago, nobody aspires to own one. Ownership equals stigmatization, and that's bad for business. But even Bentley and Aston Martin are employing frugal engineering practices to reduce redundancy and parts cost.
And frugal seems to be selling. Strong initial demand in India has proven sustainable over time, and these two cars—especially the Kwid—have helped boost Renault-Nissan's market share in India from 1 to almost 5 percent since 2015. Malik reckons a U.S.-legal Kwid could sell for $12,000, but it's not tailored to American tastes or NVH standards.
What is coming to our local auto industry is a marriage of lean design and frugal engineering. Munro & Associates and Hinduja Tech are teaming up to offer clients cost- and content-optimized CAD-modeled advance designs for parts, systems, or entire vehicles. With any luck, they'll help American manufacturers succeed in emerging markets—and perhaps lessons learned there can lower the cost of their home-market offerings.