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Old 15th April 2013, 11:46   #1
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Default Maruti Suzuki's Enormous Scale

A look into the scale of Maruti Suzuki - the company that produces a third of all cars produced in India.

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The Maruti Suzuki factory at Gurgaon in Delhi builds one car every 16 seconds
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Each car leaves the factory with five litres of fuel on board, which means that the facility will slurp though 3,750,000 litres just getting the cars out the door in one year alone.
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If you think those numbers are impressive, it really is just the start. There also happens to be another Maruti Suzuki factory just a 20-minute drive from Gurgaon, in a place called Manesar. This one will build 550,000 Suzukis this year. Which will need another 357,500 tonnes of steel
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Maruti Suzuki has 10,000 trucks on the road every day, delivering all the cars to the various dealers around the country
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Every day, his trucks cover 100,000 miles, which means that in two-and-a-half days, he might as well have sent a convoy to the moon.
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It's worth remembering that every single one has an owner waiting for it. A staggering 100,000 people have paid deposits.
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Old 15th April 2013, 13:37   #2
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Default Re: Maruti Suzuki's Enormous Scale

Good info and certainly ties up with the March sales figures. 4 out of the Top 5 cars are Maruti. They know the pulse of this nation very well and here I am talking about an every day joe and not a bhpian per say.
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Old 15th April 2013, 13:51   #3
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Default Re: Maruti Suzuki's Enormous Scale

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Originally Posted by motomaverick View Post
They know the pulse of this nation very well and here I am talking about an every day joe and not a bhpian per say.
Nothing is more true than this statement! Maruti Suzuki has really got a good product portfolio, crowding more of the entry to mid segments options for the average Indian consumer. Talking about the entry to mid level segment, there are more options available with Maruti Suzuki than any other manufacturer. This means that they have a product which suits literally every consumer. Also, cross utilising the same platform for a number of models helps it cut down huge costs which results in higher bottomlines for the company. Needless to say, it has got some of its critical strategies hit just the right spot...some due to the company's good planning and some due to the people who would go for a Maruti whatever its offering.

Regards,
Saket
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Old 15th April 2013, 14:57   #4
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Default Re: Maruti Suzuki's Enormous Scale

If you ask me there are actually 2 cars from maruti that I would buy today. The Swift and the Alto K10. I know some people who would mot buy anything else but Wagonr (god knows why). The thing is maruti has created a sense of trust among its customers with reliability, low cost of ownership, availability of service centers that most customers are not willing to try anything else. Cars are not FMCG that you buy a Coke today, try a limca tomorrow and check out the sprite next day. People buy a car once every 7-8 years and they want to minimize the risk by buying something already well established. But now a new class of people are being evolved who has more disposable income and can afford a car every 5 years. They can also afford to go for exclusive products and that why they give Ford/Vw/Honda a shot.

Currently I believe maruti is doing excellent but it wont continue for long unless it can add some aspirational values to its customers. 5-6 years down the line I believe they will have to be content with 25-30% market share. Some say "they have a product which suits literally every consumer". Well that is not true. They can not cater to people looking for a decent mir range sedan. Even the refreshed SX4 is nowhere close to Sunny or Linea let alone Verna, Vento/Rapid. Then there is lack of SUV and that is where Mahindra has been doing so well. Maruti needs to tap that market before it is too late.

Maruti has the faith in customers mind. All it needs to do is launch the products in a shorter span of time with their own diesel powerplant.
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Old 15th April 2013, 15:12   #5
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Default Re: Maruti Suzuki's Enormous Scale

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Originally Posted by oxyzen View Post
If you ask me there are actually 2 cars from maruti that I would buy today. The Swift and the Alto K10. I know some people who would mot buy anything else but Wagonr (god knows why). The thing is maruti has created a sense of trust among its customers with reliability, low cost of ownership, availability of service centers that most customers are not willing to try anything else. Cars are not FMCG that you buy a Coke today, try a limca tomorrow and check out the sprite next day. People buy a car once every 7-8 years and they want to minimize the risk by buying something already well established. But now a new class of people are being evolved who has more disposable income and can afford a car every 5 years. They can also afford to go for exclusive products and that why they give Ford/Vw/Honda a shot.

Currently I believe maruti is doing excellent but it wont continue for long unless it can add some aspirational values to its customers. 5-6 years down the line I believe they will have to be content with 25-30% market share. Some say "they have a product which suits literally every consumer". Well that is not true. They can not cater to people looking for a decent mir range sedan. Even the refreshed SX4 is nowhere close to Sunny or Linea let alone Verna, Vento/Rapid. Then there is lack of SUV and that is where Mahindra has been doing so well. Maruti needs to tap that market before it is too late.

Maruti has the faith in customers mind. All it needs to do is launch the products in a shorter span of time with their own diesel powerplant.
Well said. I think Maruti will not mind market shares as long as its profit margins are intact(Remember Nokia with huge market share !!)

Also i liked the way you described people who change cars every 5 years. Currently this is happening to sedans already and slowly shifting towards premium hatchbacks as well

Soon the likes of Dzire/Swift will have tougher competition as more and more people like to experiment with new brands.

But having said that Maruti is in a very strong position to counter attack due to its huge service network and dealerships. But its parent Suzuki is not a big player globally and hardly has any diesel engine. Even the petrol engines made by Suzuki are ordinary in nature(We should have already seen TSI or turbo charged petrol engines by now)

So Maruti's future might be in the hands of how Suzuki tackles global automobile industry !!
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Old 15th April 2013, 15:12   #6
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Default Re: Maruti Suzuki's Enormous Scale

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Originally Posted by oxyzen View Post
Some say "they have a product which suits literally every consumer". Well that is not true. They can not cater to people looking for a decent mir range sedan. Even the refreshed SX4 is nowhere close to Sunny or Linea let alone Verna, Vento/Rapid. Then there is lack of SUV and that is where Mahindra has been doing so well.
In all, I agree with oxygen...just posted to make it clear that what I meant by "they have a product which suits literally every consumer" is mainly for the entry to mid segment. My definition for entry segment would be 3 lacs & by mid segment, I meant in the range of 5-5.5 lacs. If we look at this segment, Maruti has a dense portfolio, like the Alto, K10, Alto 800, Wagon R, Ritz, A star, Estillo, Swift. So, surely it has a good car to offer to most of the people. Most of the buyers of this segment is the average-income Indian consumer, which is also the most risk-averse class. A small disagreement here, many people of this segment won't change their cars in just 7-8 years, IMO.

Agreed that any segment above this level which includes the SX4 is not the strength of Maruti. The portfolio lacks a sturdy SUV, a real premium sedan segment car and some oil-burner saloons & hatchbacks other than the Swift & D'zire.

No other manufacturer has so many options in the A & B segments as much as MS has. & fortunately, this is where most of its customers are too!

Regards,
Saket

Last edited by saket77 : 15th April 2013 at 15:20.
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Old 15th April 2013, 19:26   #7
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I bought a Gypsy 6 months ago and in my mind its a true SUV and the reliability is far better than I could have imagined in the 5000 kilometres I have done. It's been through remote places - some where there's a track for a 2 wheeler. There were 2 specific instances where veterans from:
Coffee estate managers and drivers
Resorts / Safari drives - General manager & drivers from resorts
Have actually told me to go ahead without fear - there are very few things one needs to avoid like deep slush or competitive racing. It simply gets the job done with minimum fuss and truly a very capable vehicle. One needs to see Desert storm and Raid De Himalaya videos and finish line counts to appreciate a Gypsy which is making way for newer generation cars with more power and better technology. Hats off to Maruti Suzuki for giving us a vehicle that still performs well and gives quite a few others a run for their money.
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Old 15th April 2013, 19:27   #8
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Thumbs up Re: Maruti Suzuki's Enormous Scale

Get into a Maruti Suzuki Showroom and you will get amazed with thir collection. They got cars starting from 2.5 lakhs catering every need of an Indian car customer. From the first time buyers to the upgraders to the "second-car-for-my-wife" buyers. Their range of cars is unbeatable at the current scenario. Even though their model range has some cheap fillers and also some models which cannibaizes on their other models, Suzuki dosen't seem to care till the customers buy from thir own stable only.

They know the pulse of the Indian customers. We usually want peace of mind after owning anything. The Car the Indians want is the one which just need petrol/diesel in it and it should run miles and miles even if the owner missies a few periodic service works. And Suzuki delivers exactly that. And how can the Indians forget the car company that they learnt driving with.

Moreover they got the service network in India that is difficult to beat in the next decade until someone got it as a task to do.

And all of the above the "Word of Mouth" campaign that runs for Suzuki vehicles is their best ad campaign. The mighty Tatas needs to have a retrospection and a case study on Maruti's success and how they became leaders of this emerging market while the tatas slumped from their throne.

I would like to give a great Kudos to the Maruti Suzuki Manangement for their better understanding of Indian minds..
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Old 15th April 2013, 19:38   #9
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Default Re: Maruti Suzuki's Enormous Scale

even after the market opens up for international brands, maruti suzuki is the leader. that tells many things. common men trust maruti vehicles. I wonder why I skipped this simple thing while making the purchasing decision few years ago.
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Old 15th April 2013, 20:16   #10
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Default Re: Maruti Suzuki's Enormous Scale

Both the scale and brand equity of MSIL is huge in our country. No one can just think of ignoring their cars during the decision making process no matter even if they do not buy one of theirs.

Believe it or not from the latest March 13 sales figures their good old M800 sold over 2000 copies and this is huge for a car that is nearly 30 years old

Now even this number is something many manufacturers can just dream of reaching even if they put all their portfolio's sales.

Also its closest competition the Nano just sold 1500 pieces. Now what do you say about this grand old work horse given the fact that it is allowed to sell only in the tier 2 and lower cities.

Other model figures are also mind boggling with the average of the trio Alto, Swift, Dzire clocking well over 20k units.

These are some serious numbers and it is not easy for any other manufacturer to come close to them in the near future.

Dare to say even if they increase the sales of their laggard models such as A Star, Estilo, SX4, by a third, their overall numbers would significantly go up even further!
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Old 15th April 2013, 20:17   #11
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Default Re: Maruti Suzuki's Enormous Scale

Behold, the biggest parking lot in India!

Maruti Suzuki's Enormous Scale-marutimanesar.jpg


Here is the link to the map:
http://goo.gl/maps/fGOcA
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Old 15th April 2013, 23:17   #12
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Default Re: Maruti Suzuki's Enormous Scale

MSIL is the king in India when it comes to cars and have got everything right till now. But the competition is getting tougher day by day where the global major automakers have found their way to the Indian market and offers better products than Maruti. Here the advantage Maruti have is their evergreen after sales network and strategic pricing. Another advantage is that the products of MSIL are priced so close that they ensure that the buyer always have a choice with their cars. MSIL have never did anything that great, be it technology or innovation but they have considered and targeted the common man well. They turns into reality what a common man think and dream of when buying his first car. But times are changing. Even the common man have started to think a step higher than being just a common man.
I think Maruti began to lose its ground.People who thought about the swift alone a year back are now thinking about the i20 or the Polo. This means people think that there are better cars available, not just anything from Maruti and the cost of owning a Maruti have increased a lot now. If any other manufacturer decides to make a huge investment or plan a big expansion of their after sales network, them Maruti would be in serious trouble
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Old 15th April 2013, 23:21   #13
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Default Re: Maruti Suzuki's Enormous Scale

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Originally Posted by rajshenoy View Post
Well said. I think Maruti will not mind market shares as long as its profit margins are intact(Remember Nokia with huge market share !!)
Problem is profit margins are not intact. Infact the profits are decreasing every year.

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Originally Posted by rajshenoy View Post
Also i liked the way you described people who change cars every 5 years. Currently this is happening to sedans already and slowly shifting towards premium hatchbacks as well
Applies to us as well. In 1995-2010 we had just 1 car.
2010-2013 we bought 3 cars (One preowned). And sold one. Will buy another in 2015 and probably another in 2016. So you can see. Of course I am not one of them who sell their new cars within 10 years.

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But its parent Suzuki is not a big player globally and hardly has any diesel engine. Even the petrol engines made by Suzuki are ordinary in nature(We should have already seen TSI or turbo charged petrol engines by now)
Bulls Eye!
Every OEMs have better Engines. Ford has eco Bosst. VW has Tsi. Honda & Toyota has GDi too. Heck even the Hyundais have it. Unfortunately no one is bringing these to India at an affordable price. If they do, I am sure Suzuki will be scratching their head and biting their nails.
But then again that is not the important part. It is the diesel Engines that will create a difference.

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Originally Posted by saket77 View Post
In all, I agree with oxygen...just posted to make it clear that what I meant by "they have a product which suits literally every consumer" is mainly for the entry to mid segment. My definition for entry segment would be 3 lacs & by mid segment, I meant in the range of 5-5.5 lacs.
That is why I did not quote your post. IMO Mid segment is Verna/Vento.
Thats subjective.

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Originally Posted by mustysekhon View Post
I bought a Gypsy 6 months ago and in my mind its a true SUV and the reliability is far better than I could have imagined in the 5000 kilometres I have done.
Gypsy is a great car. It has been in India for a long time. No doubt it will be reliable. But I think personally the Mahindra Thar is a arguably a better buy.
Why?
1. It does not run on leaf spring.
2. It had a diesel powerplant

Still it is not perfect. The lack of AC and the poor interior fit & finish is a letdown. The Gypsy is a gold mine. Maruti suzuki has neglected it all the way. Imagine
1. Removing the leaf spring.
2. Making the seating arrangement a proper 2+3
3. A 5 door box.
4. AC
5 And acceptable fit & finish. That would be an Ideal SUV.

Heck even the military dont want the Gypsy any more. They need stuff like AC, diesel engine. As far as I know maruti is not even in consideration of the tender.
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Old 17th April 2013, 10:00   #14
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Default Re: Maruti Suzuki's Enormous Scale

And they have a plan for the hard times too! Only they can play this just because they have every other car on the road.

"In a new slowdown strategy for its distribution network, car market leader Maruti Suzuki has been advising dealers to focus on service to ride out the slump in new car sales" says the Times of India. "In fiscal 2012-13, Maruti Suzuki's service network serviced over 17 million cars, including accidental repairs"

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Originally Posted by bejoy View Post
Behold, the biggest parking lot in India!
Thanks for sharing that.
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Old 17th April 2013, 10:24   #15
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Default Re: Maruti Suzuki's Enormous Scale

I remember very vividly from one of the automotive TV shows, which was interviewing a head honcho [I guess it was Tomas Ernberg, MD of Volvo Cars India - vaguely remember, I could be wrong though]. The interviewer, towards the end of the talk asked the honcho to associate one success factor with every Indian auto OEM as he listed all one by one. When the turn of Maruti Suzuki came - the honcho said "customer service" without blinking and without even the slightest delay!
I think that was spot-on. There is no OEM today in India which has a better customer service, not even considering the huge volumes of cars / showrooms / service centres / personnel MSIL has to manage!
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