Last year marked a period of lull for the country’s top carmaker Maruti Suzuki, but all that is about to change. Top executives, both at the company’s New Delhi headquarters and at Hamamatsu, Japan, where its parent Suzuki Motor Corporation (SMC) is based, are busy drawing up an aggressive strategy for the next five years, that includes a barrage of around 12 new car launches, sources told FE.
The plan is to increase the market share in the country’s 25-lakh unit passenger vehicle market to over 50%, by entering new segments like sports utility vehicles, commercial vehicles and large vans; introducing technology to improve fuel economy — like hybrids, diesel engines and turbo-charged petrol engines — and catering to niche markets like that for sporty hatchbacks. This is in the background of a production capacity increase by almost 2 million units across two new plants in Gujarat.
Starting middle of 2015, Maruti will mark its first serious entry into the SUV segment with the S-Cross crossover priced upwards of R10 lakh, taking on established players Mahindra and Ford. Another compact SUV (below four metre) will follow in 2016, while a third mid-sized SUV — the Vitara — will come in 2018. There is also a new mid-size MPV above the Ertiga in the works.
While its new LCV ‘Super Carry’ is slated for launch in the April-June quarter next year, the company is also planning a new compact goods van. In its stronghold of small cars, Maruti will launch a new premium hatch above the Swift code named ‘YRA’ to challenge the Hyundai i20 while word on the street is that a new entry small car is also on the drawing board.
“Maruti Suzuki, along with our principals SMC, Japan have ambitious plans for the Indian market. These includes increasing the volume levels to over 2-million units annually. Such a plan has to be supported with new models as well as product refreshments for existing models.
The recently-launched Celerio, the soon to come Ciaz and the announcement to venture into the LCV segment are a reflection of the intent in terms of product technology and segmentation,” a company spokesperson said in response to a query on the spate of new models planned.
Maruti’s playground is not limited to the Indian subcontinent either — SMC, which holds over 56% stake and rakes in about 25% of its profits from the unit, has given it charge of the emerging markets like South America, Africa and parts of South-East Asia.
The company seems to be on the right track. Market share is already up to 46% by the end of August – from 42% last fiscal, with demand for its key brands Swift, Dzire and Alto picking up on the back of improving consumer sentiments. Celerio, launched in February this year and a very important product for Maruti which is the debut platform for both its 800cc diesel engine and the AMT auto gear technology, has also done well with the waiting period on some variants extending to eight months.
Clearly, Maruti knows the Indian market better than most. All but one new car launch over the past four years have seen success and the only one that didn’t – the Kizashi – was when Maruti tried to extend its brand equity to the premium market where buyers opt for Honda, Skoda, Volkswagen or Toyota.
Roudra Bhattacharya | The Financial Express