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Old 30th August 2012, 10:57   #1
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Default Maruti Suzuki to Increase Focus on Bigger Cars

Hello All,

I came across a piece of article in today's Economic Times:

Maruti Suzuki increases focus to bigger cars like Ertiga to build market share
Full article here:
Maruti Suzuki increases focus to bigger cars like Ertiga to build market share - The Economic Times

Some highlights from the above article:
1. After success of Ertiga, Maruti Suzuki is increasing its focus on bigger utility vehicles and sedans to maintain its lead in the Indian automobile market.
2. Facelift SX4, Grand Vitara & a new Cross Utility Vehicle expected in 2013
3. New products expected to hit M&M the most, the Ertiga is already pitted against Xylo, going ahead Grand Vitara will be against XUV 5OO and the new compact SUV will be competing against Scorpio.
4. Utility vehicles account for 15-17 per cent of India's overall passenger vehicle market. But with the launch of Ertiga earlier this year, the share of utility vehicles in Maruti's overall sales jumped to about 7 per cent in the first quarter of this fiscal, from less than 1 per cent in the same period last year.

Probably Maruti Suzuki is finding it tough to maintain its lead in small car segment where Hyundai, Chervolet, Tata & others are nnow literally fighting Maruti Suzuki head-on. Also, there a number of compact SUV (like Toyota Rush, Mini Xylo, etc) scheduled to be launched in India in next 6 - 12 months.

Does this means that Indian Car Market is slowly shifting from Small Cars to SUV's? Do we have enough roads to manage these huge vehicles?

Thanks,

Last edited by Jignesh : 30th August 2012 at 11:00. Reason: Information added
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Old 30th August 2012, 11:31   #2
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Maruti here may be exploring new opportunities in the field of MUVs. They have already failed in Big Cars league - Kizashi, Grand Vitara & SX4 (not a big hit)
Now since Ertiga got a good response from the market, they are trying to utilise the opportunity in MUV class. This may not have much impact on city roads as they are prefferred as second car or family car. Also these MUVs are popular in rural families.
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Old 30th August 2012, 11:47   #3
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Hi Jignesh ,

If they really want to have a share then they must try to take the mighty "Bolero" head on , if they can manage a vehicle to compete with Bolero then they can change the game , right now they have nothing like that in their portfolio

regards
amol
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Old 30th August 2012, 11:50   #4
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Unfortunately, they have a basic handicap as they try to go to bigger (and with more margins) cars. The image as a low cost purveyor of cars will stand in the way. They will have to start a new label /brand for the higher end stuff.
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Old 30th August 2012, 11:53   #5
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Went through the thread on ET. Few points that I found intresting.
1) Facelifted SX4 due next year. Hope this is not just a cosmetic facelift. SX4 had already got one of that last year.
2) Local production of Vitara from year 2014. Vitara costs around 18 lac, and its imported ie 100% tax. Local production should ideally bring down cost to below 9 lac. Practically if Maruti is able to position Vitara with a diesel engine around 12 lac on road it will eat in to Duster/ Eco sport/ Mini Xylo sales.
3) Since Maruti already plans to locally assemble Vitara wouldnt price of that and XA Alpha overlap? Or will they position XA Alpha below 10 lac range. Similar to WagonR / Ritz / Swift positioning? And worse will they lauch locally assembled Vitara only with petrol engine like now
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Old 30th August 2012, 11:58   #6
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Quote:
Originally Posted by HighOctane View Post
Maruti here may be exploring new opportunities in the field of MUVs. This may not have much impact on city roads as they are prefferred as second car or family car. Also these MUVs are popular in rural families.
Yes. MUV's are big hit in rural market & tier 2 cities.

But even in Cities, now-a-days MUV's / SUV's are becoming a preferred choice as family car. Go to parking lot of any Mall or Cinema Hall & there will be quite a big number of these large Vehicles.

Quote:
Originally Posted by amolathalye View Post
If they really want to have a share then they must try to take the mighty "Bolero" head on
Hello Amol,

Yes, currently Maruti Suzuki has nothing to compete with Bolero, but I feel they are not keen at taking Bolero head-on. The strategy would be to let M&M lead the market with Bolero & Maruti will make in-roads in the market with better Cars like Ertiga & Grand Vitara for people who do not like buy Bolero's. Just like what Hyundai did to Alto with launch of Eon.

Thanks,
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Old 30th August 2012, 11:59   #7
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

I think Grand Vitara if priced competitively with XUV can succeed. People wont mind going with Maruti for bigger cars if priced right. They have bungled on that front. They also need to match feature wise which is also one of their weak points.
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Old 30th August 2012, 12:10   #8
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

That's really a great news. No doubt, it would have been great if this would have come little earlier, but as they say "better late than never". Surely M&M will face some heat. The article says GV will come by 2014 (I wish "locally produced and not CKD") and compact SUV (based on XA Alpha concept) to roll out by 2015, this sounds too much in future. The competition will definitely be fierce by then, but still I i don't see any reason why decision would not work out. GV would interest me more and I would love to see it getting launched earlier (may be without going under any radical changes), optimistically in 2013 itself. Not to forget, hoping they do have diesel options for forthcoming models, without which the life may be miserable for them.

So to conclude if all goes well, can we see GV (locally produced) priced @ 10L OTR for petrol and 12L for diesel? (I hope I'm not day dreaming)
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Old 30th August 2012, 12:20   #9
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Quote:
Originally Posted by mpksuhas View Post
... Vitara costs around 18 lac, and its imported ie 100% tax. Local production should ideally bring down cost to below 9 lac....
18L OTR? I thought it was somewhere around 14L ex showroom. Now I check the prices in the website and see what I found! When did it get into Fortuner territory?

Maruti Suzuki to Increase Focus on Bigger Cars-vitara_price.jpg

Quote:
Originally Posted by mpksuhas View Post
And worse will they lauch locally assembled Vitara only with petrol engine like now
Maruti knows the Indian market better than the rest! So if they are spending moolah on local production capacity, we can be rest assured a diesel option. With the license of 1.6MJD secured from Fiat, I hope to see it coming in Vitara and probably next gen SX4 as well!

Last edited by swiftnfurious : 30th August 2012 at 12:21.
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Old 30th August 2012, 12:24   #10
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Quote:
Originally Posted by Jignesh View Post
Also, there a number of compact SUV (like Toyota Rush, Mini Xylo, etc) scheduled to be launched in India in next 6 - 12 months.
,
C'mon, but the ghost of Rush and Avanza still comes to haunt, are they going to be launched or the media still stuck in the old rumours?
Coming back to topic, they could launch the APV here, though the Ertiga is already present. And the X-alpha would do good, still the Grand Vitara at under 12lacs with the diesel variant will be formidable against the segment leaders,lest MSIL gets fancy and prices it at Endeavour level.
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Old 30th August 2012, 13:07   #11
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Quote:
Originally Posted by sgiitk View Post
The image as a low cost purveyor of cars will stand in the way. They will have to start a new label /brand for the higher end stuff.
That is true to some extent. People may not like to go for a Rs. 20 lacs + Maruti Suzuki car. But Hyundai is somehow not facing is image problem. We have Hyundai Eon till Hyundai Verna, Sonata & Santa Fe.

Quote:
Originally Posted by mpksuhas View Post
Local production of Vitara from year 2014. Vitara costs around 18 lac, and its imported ie 100% tax. Local production should ideally bring down cost to below 9 lac.
Since Maruti already plans to locally assemble Vitara wouldnt price of that and XA Alpha overlap? Or will they position XA Alpha below 10 lac range. Similar to WagonR / Ritz / Swift positioning? And worse will they lauch locally assembled Vitara only with petrol engine like now
Hello,

Maruti Suzuki is always know to overlap the Product portfolio & crowd the market with similar Products. But you have made good point - Locally made Grand Vitara will give a tough fight to others MUV / SUV in India.

Also rearding Petrol / Diesel option, no Car manufacturer can now survive in Indian Market without offering Diesel Cars. Without any doubt there will be Diesel option in locally made Grand Vitara.

Quote:
Originally Posted by srishiva View Post
I think Grand Vitara if priced competitively with XUV can succeed.
Yes. Gran Vitara priced at par with competition will definitely succeed. Provided Maruti Suzuki is able to create a Luxury Car Manufacturer in people's mind.

Quote:
Originally Posted by xPK View Post
That's really a great news. So to conclude if all goes well, can we see GV (locally produced) priced @ 10L OTR for petrol and 12L for diesel? (I hope I'm not day dreaming)
Let us hope for Grand Vitara in the Price options that you have mentioned.

Quote:
Originally Posted by swiftnfurious View Post
18L OTR? I thought it was somewhere around 14L ex showroom. Now I check the prices in the website and see what I found! When did it get into Fortuner territory?
I believe Grand Vitara is currently imported & bears a huge Import Tax. A locally made Vitara will definitely be cheaper & customised to Indian Customer's requirements.

Thanks,
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Old 30th August 2012, 14:33   #12
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

SX4 replacement ?

Suzuki will reveal its new S-Cross concept at the Paris motor show in September.
No details have been revealed, but the firm describes the new C-segment crossover concept as a model that embodies "emotion, quality and aerodynamics".
Seen here for the first time in this official sketch, the five-door S-Cross hatchback will feature a distinctive beltline, plus protective body mouldings all round and a skid plate under the carís front.
A production version of the Suzuki S-Cross could replace the current SX4 in international markets towards the end of 2013.
Name:  0_468_700_http___i_haymarket_net_au_ExtraImages_20120824092744_SU_953.jpg
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Cheers!

Suzuki to showcase S-Cross concept at Paris | News | Autocar India
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Old 30th August 2012, 14:37   #13
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Quote:
Originally Posted by volkman10 View Post
SX4 replacement ?

Suzuki will reveal its new S-Cross concept at the Paris motor show in September.

Cheers!

Suzuki to showcase S-Cross concept at Paris | News | Autocar India
That is what i am thinking too.

Next gen SX4 and the Hatch version of SX4 is what they will be targeting next year.

It would be fun if we see larger 1.6 Lt Diesel engines on Maruti's. Only that can give them success beyond 10+ lakhs
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Old 30th August 2012, 14:41   #14
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

Suzuki globally is a very small (almost insignificant) player in the car industry. Even in Japan they are basically in the sub hatch area. In India they (or rather MS) have built up a brand image, so they are desperately trying to counter the global recession by somehow building market share here.
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Old 30th August 2012, 15:02   #15
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Default Re: Maruti Suzuki to Increase Focus on Bigger Cars

A Diesel Grand Vitara @ 12 to 14 Lakhs would most definately be a game changer. if they choose a proper engine for this vehicle it will be the fastest selling SUV in no time

Look at the positives
1. Marutis Service gurantee
2. Issue free ownership
3. Cost (if it is 12 - 14 lakhs)
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