Maruti pulls out all stops in market-share fight

Maruti Suzuki India is opening up several fronts in a bid to maintain its stronghold in the domestic passenger car market.

The company is debuting in the premium cars segment through ‘Kizashi’ over the next few weeks, and plans are afoot to also test the MPV segment through indigenously developed ‘RIII’ (pronounced R3) by 2012.

As all this happens, its current fleet of 14 models would continue to make inroads in rural and semi-urban markets, besides the larger cities.

Managing director Shinzo Nakanishi admitted on Wednesday the company realises that its absence in the SUV/MPV segment — which accounts for roughly 18% of the market — was proving to be a challenge.

“We have Grand Vitara and the Gypsy but these models sell very little ... we are studying this market closely, especially after displaying the RIII concept at the Auto Expo. The existing line-up of cars is not enough,” Nakanishi said.

Maruti will announce the launch of Kizashi, its most expensive car till date, in the next few weeks, he said.

The Kizashi will be pitted against well-entrenched brands such as Honda’s Accord and Civic and Toyota’s Camry and Corolla Altis.
Maruti is not looking at large volumes from the car initially. All it wants to do is enter an aspirational segment to have a wider product portfolio and a chance to study the behaviour of premium customers, Nakanishi said.

Dismissing queries on market share worries, Nakanishi said this was a function of supplies and Maruti’s twin production facilities (Gurgaon and Manesar) were already producing about 30% more than installed capacities.

On new product line-ups, he said an upgraded variant of the Swift would come in by the end of next year — the 3rd generation Suzuki Swift was unveiled earlier this year in Hungary.

Speaking on flexi production at its twin facilities, executive officer (production) M M Singh said that the production of  Swift and Swift Dzire would be reoriented across the two plans to enhance output.

So the entire assembly of Dzire will be shifted to Gurgaon by around July next year, while the Swift — which is currently made at both the plants — will be shifted entirely to Manesar.

Currently, Maruti makes about 10,000 units of Dzire and 12,000 units of Swift every month but both these models continue to have long waiting periods — 3-4 months for Swift and 4-5 months for Dzire.

Meanwhile, Nakanishi said between April and December this year, sales had risen by 31% and he did not see the growth rate abating.

This, despite a 10-day long plant shutdown bringing down production by almost 33,000 units.

Maruti’s sales in November rose 28% to 112,554 units, despite a 12% drop in export volumes. The car maker plans to invest $1.3 billion over the next three years on manufacturing plants to boost capacity.