The B+ segment has arrived

In response to consumers' demand for something bigger than B segment cars, yet smaller than those in the C segment, car manufacturers are lining up a new range of variants in this segment.

This is for the premium hatchback super-mini lovers. Car manufacturers are swiftly moving into the premium end of the hatchback segment with their latest launches.

The Swift from Maruti officially graced the shores this month. It will go toe-to-toe with Hyundai Getz, the Opel Corsa Sail, Tata Indica and the Fiat Palio in creating a new niche segment. Four more entrants are planned, including the Chevrolet Aveo, the Nissan Micra, Toyota's unnamed small car and Honda's Jazz.

What makes this segment so interesting given that there have not been much in terms of sales in the segment?

It's another question whether the hatchbacks, with a premium pricing strategy, will bring in the requisite volumes to manufacturers. Suzuki and Hyundai are betting that a large number of Indian customers will want to shell out something extra to get a car in a new segment.

The cars promise to provide more passenger space than many mid-size cars, will be easier to drive and have trouble-free ownership.

Fiat claims that they opened up a whole new segment with the introduction of the Palio. Although sales have tapered over the years, the Palio remains a good car to buy, say sources.

The B+ segment is where the action from other manufacturers is. Although everyone is putting their money where their mouth is, it is essentially a growing segment.

Says a small car manufacturer, “We have found that those already in the B segment want a bigger car, but a much bigger car could pose parking problems. So the B+ segment is ideal.” The premium hatchbacks could snatch volumes away from sedans (priced at above Rs 5,00,000),” said an auto analyst.

Today, all those who are driving A segment or even B segment cars are looking for an upgrade and the B+ segment makes perfect sense as it is one step higher than B, yet does not go into C.

So then, do small cars compromise on safety? It is a proven fact that the small car is intrinsically unsafe compared to a bigger car.

But today, small cars are coming loaded with ABS and airbags in addition to leather upholstery, CD players and the like. In terms of features and specifications, they are equivalent to other bigger cars.

As people want to shift to superior cars, but not give up functionality, the B+ segment cars are an attractive option. The segment is getting more populated with new offerings and the value proposition of each product is going up.

All this means that the B+ segment is one which will see a lot of action in years to come. However, it remains to be seen as to how much is lapped up by the discerning Indian consumer.

The crossover car trend was introduced in India by GMIL, with its hatchback Corsa Sail, nearly two years ago.

But the model did not generate much excitement among consumers. But that has not dampened GM's sentiments about the growth prospects in this market segment.

India's auto market has grown at more than 10% annually over the past five years on the back of robust economic growth and three-decade low interest rates.

The Indian auto market is expected to expand at a fast clip on new launches, rising incomes, cheap loans and a growing used-car market, which is encouraging faster replacements.

But in a country where per capita income is about $500, small and compact cars command a whopping 70% of the market. Suzuki has said that Maruti will become its global base for small car development.

General Motors is expected to begin production of Spark, its variant of the Daewoo Matiz, and Toyota Motor has said it is looking to launch compact cars, possibly through its subsidiary, Daihatsu Motor.