[Stribog]

Originally Posted by GTO

The reasons why Maruti clicked are entirely different from Hyundai. The reasons why the two newcomers were successful are also vastly different. Kia & MG both did their branding right, although Kia was 10X more aggressive with the product, variants, engines, dealers, production, logistics etc. Imagine giving your suppliers a commitment of 8000 Seltos a month before your factory is even ready!!! That was deadly. For a Chinese brand, I think MG did a fair job with the Hector; the product also did a lot of self-selling due to the size, features & bling.

Absolutely, it was given so many many exceptions.

It was granted the right to form a JV with a foreign auto company when these were rarer than a Unicorn (the animal, not the startup entity)

It was granted the right to import 40,000 cars when one could not get an import license to import 100 cycles without greasing a 1000 palms.

But, the 800 was a paradigm shifting (to use a cliche) product. Look at the early run of MS.

800, Gypsy, the MS 1,000 (I still remember seeing the first one in public in a parking lot in a Taj Hotel- I was 10 maybe and just stood there staring at it, looking through the windows and basically drooling all over the car), the Esteem, the Esteem Auto, the Alto.

Every single product was market defining, or market creating knockout of the park success BECAUSE it offered exactly what the market wanted.

Then you have the classic Zen, who can forget that jellybean shaped beauty.

Or the first gen Swift.

I mean, except for the odd Ignis or the D segment Kizashi, MS always read the market well, and positioned its products even before the market knew there was a need for such a product.

For this, full credit to its management team.

Originally Posted by landcruiser123

A huge chunk of cars in India are micro & compact cars with razor-thin profits. As of today, I feel like only the Koreans & Chinese are really aggressive in the Indian (and other major) markets as they are still relatively newer brands which are finally getting some level of mass acceptance(especially true for Kia in the US). Note: The Chinese haven't yet entered the US.

Toyota, Honda, Ford, Chevy, Ford, Chrysler, VW, Nissan are mature brands(at least globally, compared to the Koreans) which are busy focusing on bigger markets and just don't care about expanding in India.

MS PBT is 7%,

VAG India - 3.5%, VAG Worldwide - 5%

BMW Worldwide - 5.2%

And on and on it goes,

Ford (arguably the manufacturer of huge vehicles in the PV segment) is in the 2% mark (though this was from 2019, not checked since)

Profitability has nothing to do with vehicle size.

[Bibendum90949]

Originally Posted by landcruiser123

A huge chunk of cars in India are micro & compact cars with razor-thin profits

Profits while selling the car may be razor-thin, but let's not discount the millions companies like MS being volume players make with service and spares.

[CARDEEP]

Originally Posted by Stribog

MS PBT is 7%,

VAG India - 3.5%, VAG Worldwide - 5%

BMW Worldwide - 5.2%

And on and on it goes,

Ford (arguably the manufacturer of huge vehicles in the PV segment) is in the 2% mark (though this was from 2019, not checked since)

Profitability has nothing to do with vehicle size.

PBT is lesser relevant when the business structures are complex & the management (s) can make money from related party transactions

If the margins are thin why are they still in business? That's primarily because someone elsewhere (read at the top) is making money on managing things (through family owned trusts) & lot of money is flowing to related entities in form of payments for supplies & royalties. Had this not been the case, they would have let public buy shares than being invested in each other.

& Yes profitability has lot to do with vehicle size. Toyota & mont other (with reputation) can make 100%+ profits on bigger cars, but this target is not met on smaller vehicles. Hence, they are out of not so lucrative small car segment, despite not working on optimum capacity.

[sumeethaldankar]

I think that Hyundai became the Maruti of type of people who did not wanted to be associated with Maruti's cars as they were more common. The person who wanted a car like a Maruti (fairly reliable & fuel efficient) identified with brands like Hyundai and went for these instead of the Suzuki cars. Nation wide Maruti's are known as the middle class car. No offence to anyone even I have one. The common dude who thought himself better simply went for the likes of Hyundai then and now Kia.

For the non movers who could not get more than 5% of the market share the most common factor of buying a car (affordability/reliability/fuel effiecieny/easy servicable) was more or less missing. I believe they did not make it mostly because of the above mentioned factors.

[Kosfactor]

Originally Posted by sumeethaldankar

I think that Hyundai became the Maruti of type of people who did not wanted to be associated with Maruti's cars as they were more common. The person who wanted a car like a Maruti (fairly reliable & fuel efficient) identified with brands like Hyundai and went for these instead of the Suzuki cars.

Until the Swift came along, Maruti did not have an answer to Santro. It may not have had the looks , but during its time if you had driven only Maruti vehicles - Santro will feel like a massive upgrade on most other things.

[AirbusCapt]

Both the players Kia and MG used a different playbook for India when compared with say a Ford or a GM. Ford and GM also entered India in a different time and era. They focused on small compact cars, batch engineered Chinese/Korean brands and tried to compete directly with the kingpin i.e. Maruti.
What both MG and Kia did was to concentrate on the compact to medium SUV space. This was a space where there was no Maruti and the only competition was from a Creta and a Nexon. So the product mix was both profitable and lacked competition as such.
Both these companies also never gave the impression that they are cheap car makers in any way. MG cleverly hid it's Chinese origin by putting in the iconic Morris Garage name and pasting the British union jack at every place possible. Kia played a clever brand story involving their biggies like the genesis and the Palisade etc to highlight how they are a posh cousin to the Hyundai.

The cars launched by these brands were also problem free, didn't suffer from any major failures as such and they were filled with goodies like a big sunroof, a large touch tablet, voice controls etc which the public loved.

Incidentally Tata motors too learned quickly from the same playbook and started heavily advertising the landrover D8 platform for their Harrier and then the Safari. They kind of matched the goodies from the sunroof to the voice commands and the result is their cars are selling well and outperforming the MG for quite a while now.

[Bibendum90949]

Originally Posted by Kosfactor

Until the Swift came along, Maruti did not have an answer to Santro. It may not have had the looks , but during its time if you had driven only Maruti vehicles - Santro will feel like a massive upgrade on most other things.

This is very true. Styling wasn't it's strong forte but Santro outclassed Maruti on most fronts. Just cross posting from another thread.

Originally Posted by Bibendum90949

My first hatch - Santro Xing XS 2004

This was in 2004. The obvious and popular choice in the segment was a Wagon R. Couple of test drives and back to back test drives of both made it clear that Santro was a better car by pretty good margin. For me, Santro drove and handled better. Wagon R felt too floaty and had a very vague and light steering for my liking. The fit and finish of Santro too felt a notch above. Also I had driven my cousin's Santro Zip plus for couple of long trips, and that had helped in zeroing in on Santro without an iota of doubt. And the car is still going strong and being used as a beater car in my ancestral home after 17 years and 77K on the odo. The OTR Bangalore price was 4.75 lakhs or so.

[Steelneo]

MSIL and HMIL are strong due to their early entry. MSIL has good product offering suited for the middle class people in the country. They made the dealer network widely and the car are easily serviced by local mechanics. This make it volume seller.

Other OEM's get stuck in-between brand & affordability. They struggle to make volumes as well as choosing compromises in their brand image.

KIA & MG, they got the success in first entry since they understood the current pulse in consumer ie., SUV craze and crafted they product well and marketed it aggressively.

Another player silently performing well is TATA Motors primarily on their good looks and crash performance. We can expect to see more volumes from TML models in future.

Toyota, two good project and they are happy. Still don't understand the premium of Baleno's Glanza.

The latest entrant Citroen, Someone need to tell them to read the post here. loads of lessons and opinion's they can take.

[shenoyshrikants]

Originally Posted by landcruiser123

On the global stage, Suzuki was and is never well accepted. They have pulled out of the US years ago as their cheap cars couldn't handle the American roads and drivers. If not for India, I'm willing to bet Suzuki cars would have been defunct or absorbed into another large Japanese company. Suzuki + Toyota partnership is probably the first step towards the merger, but that's a topic for different thread

The importance of MSIL for Suzuki is proven by the fact that more than 50% of Suzuki's global sales comes from one country, i.e. India. And its much more than what it actually manages to sell within Japan.

While we are this discussion, one thing to note is that we have brands like Ford, Volkswagen and others who are selling dismally low numbers month on month. Some models even having double digit and single digit monthly sales. Its abosolutely not economical for any brand to continue a long while with such sales numbers, considering the fixed costs the manufacturer as well as the dealers have to incur to keep them running. Unless brands can have consistent market share of at least 3-5%, it will become financially unviable day by day to remain in the market and make some money and more will end up the same way as GM.

[raiuday]

MS was seen continuing from a generation back when people needed cars to travel on the not so well laid network of roads, not so established communication, proved they're reliable, spread across the country with time. Back then, reliability was the primary objective unless people were looking at the niche segment.

Leaving Maruti Suzuki aside, when any new entrant from the Global market enters the country, people refer to the strength of that manufacturer globally. Let's say Ford is famous for it's performance, heavy vehicles and wide network in the US. Hyundai is famous for it's designs. Kia for the premium features in mid segment vehicles. When these brands enter India, they should start off and advertise here with what they were famous globally, so that people would be willing to pay for the tried and tested, successful products. If such products are too pricey, then the manufacturer needs to focus on India specifics right from day one.

1. Lower entry point to the same product which can go to much higher pricing based on the engine options. ( Kia did with the sonet).
2. Marketing the product well before the product launch. ( MG were able to convince so many with just their marketing even before the actual product launch) Announce pre-bookings while marketing and increase the manufacturing capacity based on the feedback.
3. Concentrate on the exterior and interior design along with interior features. A car that looks apart ( like how the initial swift looked like some car out of NFS game and curvy). Who doesn't want to feel welcome in a car that looks like it was designed by an interior home designer.
4. Easy and cheaper maintenance vehicles with widespread service network. Handle initial issues with attention and providing long term fuss free warranties.
5. Use same engines in multiple models to reduce the costs of sourcing parts and R&D. ( Like MS used the same diesel engine in Ertiga, brezza, S-cross etc., Same with the 1.3 MJD )
6. Make cars in all sizes in mid segment prices (small car, sub compact SUV, compact sedan, compact SUV and a 7 seater pricing between 5l ex-showroom to 18l wherein 90% buyers get their first car or their first upgrade). If observed keenly, no car manufacturer who sells a 40l+ on road India priced vehicle in their portfolio have that good sales of their other offerings in India.

[nickatnite]

Ever since the pandemic i have observed lacklustre attitude to the market by Maruti-Suzuki. Witness the indefinite postponement of the small car Celerio which is their USP in India.Maybe there is a concerted effort to overturn their monopoly by vested interests, allegedly. Atleast, this is my observation.