[wildon]

Originally Posted by theMAG

The single biggest reason Maruti sells: its service network. It is simply excellent: no attitude problems, reach, minimum response time, reasonable maintenance costs (not cheap). That they are able to scale up despite the volumes is an achievement by itself.

Maruti is very good at getting referral, repeated customers due to above mentioned points.

If you are comparing this with Hyundai they were good till Santro.

Even though their new cars looks good and feature packed, the company/ dealer/service least bothered about the customer once the sale is achieved.

[libranof1987]

Originally Posted by swiftnfurious

The first & foremost reason for the domination is the number of products spanning the most sale'able segments.

My exact thought.

MS has a pleasantly wide range of products in the segments that matter the most : the "mass-selling" ones.

Until a few years ago, they started off with the humble M800 and brought in Alto; imagine having M800, Alto and Alto K10 to choose from for starters. Then, the next segment flows in. Omni is holding it's fort even though it's the vehicle that it is!

It's the product line-up that ensures half the battle is won.

Another aspect, the ease and cost of service. We Indians consider it a major factor in the ownership of vehicles and this is another area where MS wins hands down.

About how their market share has been reducing over the years, isn't it obvious?! There's far too much competition and most of the manufacturers are trying to catch up.

Also, the Indian customer has matured; more than brand name, he also considers other factors, albeit marginally.

So, it's going to be a while until MS ceases to have market dominance.

[civic-sense]

Originally Posted by BUXX

The fact remains that the Japs manufacture the best automotives. Period.

Well engineered, trouble free and assured service.

To top it all, Maruti market & price their vehicles for the mass market rather than for the premium niche ( Honda, Toyota etc)

Nothing, but a first mover advantage. I had read somewhere that initially Maruti was in talks with volkswagen for collaboration. Talks failed and they moved on to Suzuki. If they had collaborated with VW, our roads would have looked different. We would have had safer sturdier cars than the tin cans.

The first-mover has the power to shape up a market, and the kind of market we get depends on who shapes it. Alas, we got Suzuki.

[avira_tk]

Originally Posted by civic-sense

Nothing, but a first mover advantage. I had read somewhere that initially Maruti was in talks with volkswagen for collaboration. Talks failed and they moved on to Suzuki. If they had collaborated with VW, our roads would have looked different. We would have had safer sturdier cars than the tin cans.

The first-mover has the power to shape up a market, and the kind of market we get depends on who shapes it. Alas, we got Suzuki.

The first mover advantage cannot be dismissed, going by the current VW attitude when it comes to kit level and pricing, I doubt they would have achieved what Maruti has over time. The fact that VW was not able to deliver matters. Their cars are built using heavier gauge steel, reliability is still not a VW hallmark and never has been, so Suzuki won because it was the best suitor. VW wasn't exactly a powerhouse then as the Industry was more fragmented.

VW current sales show that their products are not what the majority want, the Japs are strong competition to the Euros and will be in the foreseeable future.

[DieselFan]

Originally Posted by civic-sense

If they had collaborated with VW, our roads would have looked different. We would have had safer sturdier cars than the tin cans.

I think Safety is relative. Not sure how you term a 5 STAR NCAP rated car as Tin Cans (Swift is a 5 STAR NCAP rated car). Swift has better Pedestrian safety as compared to any of the european cars. Current generation models have all the safety features that one wants.

On a lighter side safety of a car is Based on the one Nut (that is behind the wheel ).

[.sushilkumar]

Originally Posted by DieselFan

I think Safety is relative. Not sure how you term a 5 STAR NCAP rated car as Tin Cans (Swift is a 5 STAR NCAP rated car). Swift has better Pedestrian safety as compared to any of the european cars. Current generation models have all the safety features that one wants.

On a lighter side safety of a car is Based on the one Nut (that is behind the wheel ).

Agree , it all depends on one Nut .

But to put the things in black & white

The Indian and European versions of swift are manufactured at same plant using different material & method and needless to say that the NCAP tested version will never made it to Indian market. All thanks to tight safety regulations in europe. How much a tin matters in crash , no idea .

Above was told me by somebody who used to work in the very factory where swift is manufactured .

[civic-sense]

Originally Posted by avira_tk

The first mover advantage cannot be dismissed, going by the current VW attitude when it comes to kit level and pricing, I doubt they would have achieved what Maruti has over time. The fact that VW was not able to deliver matters. Their cars are built using heavier gauge steel, reliability is still not a VW hallmark and never has been, so Suzuki won because it was the best suitor. VW wasn't exactly a powerhouse then as the Industry was more fragmented.

VW current sales show that their products are not what the majority want, the Japs are strong competition to the Euros and will be in the foreseeable future.

The answer lies in the last line I wrote.

The first-mover has the power to shape up a market, and the kind of market we get depends on who shapes it. Alas, we got Suzuki.

There is no evidence that suggests that, in 1982, when Maruti came with the 800, customers at that time craved for cheap, reliable, fuel-efficient automobiles. Maruti gave us a "different class" of cars than what was unknown to us till then, we liked them, and a new market was born. And it is my guess that if Maruti had got VW instead of Suzuki as their partner, in all possibilities, we might have been rooting for safer, sturdier cars with the same conviction with which we root for cheap, reliable cars now.

[pganapathy]

Originally Posted by avira_tk

The first mover advantage cannot be dismissed, going by the current VW attitude when it comes to kit level and pricing, I doubt they would have achieved what Maruti has over time. The fact that VW was not able to deliver matters. Their cars are built using heavier gauge steel, reliability is still not a VW hallmark and never has been, so Suzuki won because it was the best suitor. VW wasn't exactly a powerhouse then as the Industry was more fragmented.

VW current sales show that their products are not what the majority want, the Japs are strong competition to the Euros and will be in the foreseeable future.

No doubt the first mover advantage is important, but let us be fair to Maruti. They have done a good job with it.

Consider that HM really has first mover advantage in this market. Then came Premier. MS came in after that and was followed shortly after by Fiat. None of the other three have managed anything remotely close to MS. HM and Premier are effectively not even car manufacturers anymore. Selling under 500 cars a month is not a long term strategy unless they are extremely highly priced.

Maruti's biggest advantage is their reach. Almost any small town has a Maruti dealer or A.S.S. This is shown best in how most (though not all) of the other manufacturers sell best in the bigger cities where they have service centres. Yet even today approximately 70 percent of India live in rural areas and this is the biggest market for Maruti. Yes, road infrastructure is an issue here but that is no excuse for the other manufacturers to ignore this chunk of the market. Remember than when this part of the market has more money and infrastructure, the only thing they will remember is the manufacturer they can see, which is Maruti. They are the aspirational brand for so many people in our rural areas that Maruti will only lose a huge chunk of market share if they shoot themselves in the foot.

[Jignesh]

Just to share my recent experience while buying a Used-Car.

Whichever Garage I ask, they suggested same thing: If I want to go for Petrol car, then just go for Maruti, no other choice.

When I enquired about Tata Cars they were of opinion that Tata Cars are costly to maintain (I don't know why).

Also the reach of service of service stations is another plus point. If you are struck somewhere in Himachal Pradesh with Fiat Linea, local mechanic may not be able to evven understand the problem.

But most important herd mentality in India. We are afraid to try something new. People see which is is most visible car on road & just follow others.

Also during my recent visit to Maruti showroom, I reliased that they have car for every price point i.e. from Alto to Vitara. If you have a modest budget of Rs. 3,00,000 they have Alto & if you are premium buyer with budget of Rs. 8,00,000+ they have SX4 & other cars in between & beyond.

Also I believe re-sale value of Maruti cars is the highest.

Thanks,

[GenuineOptimist]

Originally Posted by akshay380

I googled and found this. Maruti market share declines to 54% in April-May

So in 2000, MSIL share was 54% down from 72% in 1999 which is down to 40% now.
Not an absolute dominance really.

I would agree with this.

In the last 10 years, most Indians have moved up the social ladder. We now need cars across the spectrum from entry level hatchbacks to sedans, saloons, SUVs, off roaders, station wagons, ultra luxury cars, 250bhp sports cars and so on.

The market now is just not satisfied with 3 manufacturers namely Maruti, Premier and Hindustan Motors providing 6 variants. The key question is whether Maruti is able to cater to this wide spectrum of demands. Maruti is still the market leader in entry level B or C segment.

If someone wants to buy a C+ or D sedan, is Maruti able to compete with Honda, VW, Toyota or Skoda in terms of the offer of variants?

When income levels continue to rise and Indians demand more of sophisticated cars, I think Maruti's dominance will come down. Unless it acquires a European or Japanese company, introduces a new Brand and gets the technology and research/design/manufacturing capabilities that go into these model cars.

[Ashley2]

Originally Posted by urajkumar

I saw this news and started wondering how Maruti is absolutely dominating the Automobile industry in India.

1) Domination: 40% of all cars sold in Feb is Maruti (Maruti Vs 13 other brands). Closest competitor is hyundai with 14% market share


3) Service: In spite of having the most volumes, the sales & service is absolutely the best. Normally if any company has monopoly with high volumes, the service normally suffers (Airtel for example) but yet Maruti is an outstanding exception.
4) Value for Money: Given the demand it still remains absolute value for money. They could raise the price & no one will complain but yet they remain very competitive against all cars (You will agree when you look at cost comparison in the link of the Taxi Dzire vs against TATA cars).
5) Brand Loyalty: When the strike happened, delivery's were late etc media were speculating the end of the brand domination. However there was hardly a whimper of dissent anywhere on delay & the customers waited patienty. When bookings opened, the market responce was overwhelming. We just love the maruti so much that we turn a blind eye to even obvious issues. "Love is blind"
6) The Midas Touch: Whatever they do, they find success.
- The Swift Diesel runs on Fiat engines but there are many other cars which are on the same engine which are not even close
- Put a ugly boot on the Swift and yet it sells. Make it a notch back and it still reaches the top 3 in car sales
- The Eon came with the entire media backing it up but still Alto rules the roost till date
- The wagonR is still in top 5. Forget even that, they are still selling 7000+ OMNI's

I was thinking about starting such a thread and you have come up at right time.
Yes, its true that Maruti dominates Indian market and they are exceptionally good value for money both during / after the purchase.

Here are my views:
Maruti IMO, understands the market very well and it may take some more time (atleast 20 years for a company form Inception - HMIL and TML are atleast 5 years away).
Remember Alto launch in early 2000, at that time 800 was selling close to 12K till mid 2000, Alto was trailing it only. When Maruti felt 800 was getting aged (in terms of sales) it replaced with Alto by considerably reducing the price and now it has taken the sales to over 30K consistently for months.

Next is Versa. Came with same Esteem engine but was not positioned properly. Next a course correction was done as Eeco, and now its selling ~7000.
The next one in the cards should be A star. If Eon and Nano had taken off well, then it would be answered with A star by MSIL.

The most important thing IMO is the importance of brand Maruti(which even was understood by Suzuki) and that's the reason they have not changed the company name as Suzuki India Lmited instead of Maruti Suzuki India Limited, when suzuki got a controlling stake in the company.

Also another area is the resale value.
Here I have nothing to quote. The slowest depreciating brand in the Indian car market.

Originally Posted by akshay380

I googled and found this. Maruti market share declines to 54% in April-May

So in 2000, MSIL share was 54% down from 72% in 1999 which is down to 40% now. IMO MSILs sales are driven by the thought that marutis are always cheaper to maintain and anyone can service a maruti. Once that perception starts to melt, we will see the share going down unless MSIL takes corrective action. and their cars are overpriced for what they offer.

Not an absolute dominance really.

But what is the TIV of the Indian automobile market in 2000 / 2012.
In 2000 it was not even one million and now its more than 2million.
And in this TIV, having a share of 43% is way big compared to even having 100% during 2000.

TO agree with you, the market share may get reduced in days to come, but if you see the Volumes they handle is likely to increase YoY.

Originally Posted by s4ch

Maruti are still the best value for money in India. Most people (in the last 15 years or so) would have had a Maruti as their first car, and seeing the lack of trouble and problems, coupled with extensive after sales service coverage and cheap maintenance, most would be inclined to stick with the same brand. ....

Thus I do not see their dominance diminishing anytime soon, although I can possibly imagine in another 10 years the younger generation switching their preference to brands like Honda and Hyundai because of the fashion statement associated with such brands - that is unless Maruti gets back with the times and revolutionise their image like the Swift did back in 05/06.

Right about service centers. They are way ahead. Paid jobs / parts are relatively cheaper and the way they handle such a huge population of cars is a big beauty.
Even the dealerships / service centers are located in a proper manner that none are skewed and handle the cars easily.

Originally Posted by .sushilkumar

...
d ) The competitors has made a dent in their sales but those mattered really always stayed away from High volume market . for Eg Honda / Toyota .They have started to enter that volume drive market now but again with just one or two offering , they cannot compete with MSIL , who has car positioned at every price point with a diff of just 25- 30 K.

F ) IMO they Still hasn;t faced real competition . Hyundai has just Age old santro and I 10 competing with their 5-6 models. Eon is launched just few months back to make any significant impact. compare that to MSIL who has atleast 6-7 diff Models Offerings south of 5 lakhs. Ditto for other manufacturer;s as well. tata has just indica , nano / Toyota has liva / mahindra is absent completely / Honda has jazz and now Brio and let us not talk about Germans or european ;s here. ..

No competition can position products so close in their port folio. Today the closest being the Santro/i10, Nano/Indica/Vista, Spark/Beat.
But what is the effect of them after lauch. Neither the MS improved drastically nor have increased the walk-ins.

The market have stabilised with Tata and Hyundai with each ~15 to 17%.
Even when these two comes with multiple options in the price sensitive (3 to 5lks) its likely to eat up the existing sales and the volume will still be in the same level, if not a massive change.

The recent addition of Eon is a case to study here.
Though it was backed by Media and sure it was a good car, the reason for not so great take off, is purely because the brand Hyundai is far from the first time car buyers mind.
Hyundai is unlikely to come to that level also in near future and may take atleast another decade.
Tata which is another closest brand for first time car buyers have also failed miserably with Nano(I use the word fail purely in the context of high sales numbers and not with respect to any technical issues)

Originally Posted by rohan_iitr

I agree that Maruti's market share is highest in the number of cars sold. But if we were to calculate Maruti's market share in terms of the cost of cars sold, the picture may not look so rosy. For example, 1 Innova sold by Toyota can be compared to 4 Alto's sold by Maruti, in terms of the price of the product.

It would be even more interesting if we were to calculate the profit made by the company by selling these cars. For example, what is the profit margin for Maruti on 1 Maruti Alto vs the profit margin for Toyota on 1 Innova.

May be the other car companies are not bothered by the wafer thin margins generated by entry level products and they prefer to keep Maruti occupied in this segment while they mint money in the more profitable segments.

Rohan

But dear, why should we consider the Margins.
Then Mercs/BMW's are still big compared to Toyota in India.
If you watch closely, only a company with huge financial stability will dare to stand with wafer thin margins.
If they are not so strong, they maynot sustain.

As a matter of fact,I remember the price of Alto LXi in some 2003, it was ~307,000 ONR.
Now its some ~315,000 ONR. See the level of price appreciation in about 8 years.

[avira_tk]

Originally Posted by pganapathy

No doubt the first mover advantage is important, but let us be fair to Maruti. They have done a good job with it.

I am saying that the first mover advantage was not the only thing Maruti had going, they have maintained their lead despite all the heavyweights present in the market today. They understood market requirements and kept at it. No company shows that level of dedication, even Toyota service is now stretched with Etios sales. Maruti seems to be opening service stations in the lounges of its existing service stations

Originally Posted by civic-sense

The answer lies in the last line I wrote.


There is no evidence that suggests that, in 1982, when Maruti came with the 800, customers at that time craved for cheap, reliable, fuel-efficient automobiles. Maruti gave us a "different class" of cars than what was unknown to us till then, we liked them, and a new market was born. And it is my guess that if Maruti had got VW instead of Suzuki as their partner, in all possibilities, we might have been rooting for safer, sturdier cars with the same conviction with which we root for cheap, reliable cars now.

I was talking to a family member who bought one of the first 800s in our circles, he mentioned his first service experience with the car. The car was given in the morning and when he asked how long it would take, he was asked to come in the evening. He still has a Maruti in the family, has been a customer for 20 years. The HM dealer at the time used to take a week, basically parked the car there and gave it you without doing anything.

The mechanic was the lifesaver who took care of your Ambassador. Maruti was one of the first cars you could tank up in the morning and drive off to Bangalore from Cochin without visiting you mechanic a week in advance of the drive. The market isn't rooting for sturdier cars as the sales charts show, cost matters and Maruti delivered.

PS: The HM dealer now deals/services Skoda, explains their reputation.

[civic-sense]

Originally Posted by pganapathy

Consider that HM really has first mover advantage in this market. Then came Premier. MS came in after that and was followed shortly after by Fiat. None of the other three have managed anything remotely close to MS.

Originally Posted by avira_tk

I am saying that the first mover advantage was not the only thing Maruti had going, they have maintained their lead despite all the heavyweights present in the market today. They understood market requirements and kept at it. No company shows that level of dedication, even Toyota service is now stretched with Etios sales. Maruti seems to be opening service stations in the lounges of its existing service stations

PS: The HM dealer now deals/services Skoda, explains their reputation.

I repeat, Maruti brought something new to the market, not that customers were waiting for Maruti to happen. I'd say, the job was easier for Maruti considering that HM and PAL had archaic models in their lineup. Still, Maruti's success took its own sweet time. Initially people were skeptical about buying a "small" car. It took time for Maruti to establish themselves. Once somebody has the market under them, for somebody to dislodge them, they have to bring in something really new. Which nobody was able to even after new companies like Daewoo, Fiat etc came. Customer attitude is predictable: You have something new to offer, I'll buy that. Else, I'd stick to the tried and tested option. Had Daewoo been the ones who came here in 1982 and Suzuki in 1995, this thread title would have read "Absolute Domination by Daewoo".

How do you explain the virtual-non-existence of Suzuki in many large car markets? Why did it get it right in India while they couldn't in other markets?

Maruti Suzuki sold the idea of cheap, fuel efficient cars to the Indian market, and unless somebody brings something that could dislodge that, Maruti Suzuki is going to be in the lead.

[wilful]

Yes -Maruthi Suzuki had the first mover's advantage (with a fair time lag before the others came in). Yes - they brought in quality and looks not experienced by the market before. And yes - they have brought in fuel efficient cars - at decent prices - with ok after sales.
In addition to all this I get a feeling that the other majors have not been as serious about India as maybe some other emerging markets - and have not bet as heavily as Suzuki on this market thus far. Just my opinion.
Maybe things will hot up in the coming years and we could see some serious contenders for the top spot.

[romeomidhun]

Those who were teens and above when Maruti came to India, are now 40+, and they are the main fans for Maruti nowadays. They are the ones who, at those times, experienced what quality and style is, when compared to HM and Padmini. They keep their affection towards Maruti even now.

But the current young generation are seeing the quality and style of the new entrants, and equally preferring them along with Maruti. So, after some 10 / 20 years, Maruti may lose the current advantage position, IMO.

(Note: Not applicable for Maruti Swift ).