Maruti Suzuki, the country’s largest carmaker has swiftly turned into a primary choice for car upgraders in India – i.e. Rs 10 lakh to Rs 20 lakh segment.
A small car specialist, which has over 61% segment share in the sub-Rs 10 lakh category – with its new range of premium hatchbacks, SUVs, and MPVs, the company became the number one player in the Rs 10 to Rs 20 lakh segment in FY23 with a market share of 19% – ahead of its arch rivals Hyundai Motor India. This has further swelled to 22% in first quarter of FY-24 led by higher share of premium SUVs.
Speaking on the sidelines of Invicto – the premium MPV event, Shashank Srivastava, Senior Executive officer, sales and marketing told Autocar Professional, “Whichever segment Maruti Suzuki enters into – it is able to create a mark, only the types of products and the consumers change. The company understands the Indian consumers well, and is able to break into a fresh and new customer base.”
For Invicto – a vehicle priced between Rs 25 lakh to Rs 30 lakh – Maruti Suzuki was able to generate a booking of over 6,800 units in the last few weeks. The company is sitting on a booking of over 2 lakh units of SUVs – predominantly they are in the Rs 10 lakh to Rs 20 lakh bracket.
The market share of Maruti Suzuki in the Rs 10 lakh to Rs 20 lakh segment has quadrupled in the last few years from 4-5% to 20-22%, and the big factor behind this is the range of new SUVs and MPVs that it has introduced since 2018.
Not surprisingly, the company is already the second largest player in the fast-growing SUV space, just a few hundred units lower than Mahindra & Mahindra. A predominant part of the SUVs that Maruti sells is in the Rs 10 lakh to Rs 20 lakh segment.
The shift towards higher priced vehicles has been driven by rising commodity cost, road taxes, insurance pay out and increased features, and hence the average price of vehicles sold in India has breached Rs 9 lakh to Rs 10 lakh from an average of about Rs 6 lakh to Rs 7 lakh just three to five years back.
“It is a fallacy or a myth that Maruti can’t sell premium cars or SUVs or upgraders prefer other brands. Nexa, our premium channel is set to be the second biggest automotive retailer (after Arena). On a base of 3.7 lakh units in FY-23, we have so far grown over 70% and the sales from Nexa are likely to cross about half a million units,” underscored Srivastava on how well the brand is being accepted in the high-end of the passenger vehicle market.
On the Rs 20 lakh to Rs 30 lakh segment where the Invicto MPV is positioned, Srivastava said that the segment accounts for 5-8% of the Indian passenger vehicle market and a majority of the buyers in this segment are the additional car buyers at about 85-90%.
Given the higher price tag, naturally, the share of the first car buyers is very small in the Rs 20 lakh to Rs 30 lakh, but there is a big chunk of replacement buyers in the segment.
As more and more alternatives emerge in the Rs 10 lakh to Rs 30 lakh segment, Srivastava is confident of grabbing a pie of this growing segment. Many experts reckon that this upgraded space of Rs 20 lakh to Rs 30 lakh will turn out to be the new battleground for automakers to fight for in the next five years. Approximately 4-5 million SUVs are likely to be sold in India between 2020 to 2027, many of whom would like to upgrade to models like Invicto.