Even as the Indian passenger vehicle market heads towards its slowest growth since the Covid pandemic, Maruti Suzuki remains confident about its long-term prospects — projecting industry volumes to touch 6 million units by the end of the decade, up from the current 4.2–4.3 million. The company is banking on a sharper premium push through its Nexa brand, a stronger SUV play, and safety upgrades across its line-up to capture demand in a market where aspirations — and prices — are steadily climbing.
But the road ahead is not without challenges. Maruti’s market share has come under pressure as entry-level car sales shrink and rivals gallop ahead in the SUV segment. Even as Nexa celebrates 10 years and 3.2 million cumulative sales, industry watchers say it will need more high-ticket models to keep pace with an upward-shifting core market. Nexa has just added a limited-edition Grand Vitara to boost showroom appeal, while Arena is being primed for an all-new mid-size SUV aimed squarely at pulling share from rivals in the ₹10–20 lakh bracket.
Indian Car Market Growth
Partho Banerjee is confident about the future of India’s automotive landscape. With car penetration per thousand people still at a modest 34, Banerjee sees immense potential for expansion. “It has to move up,” he says, noting that India’s car market is expected to grow to nearly 6 million units annually by the end of this decade from the current levels.
But this growth will not be linear. Industry analysts point out that the next leg of expansion will be harder won, as the easy gains from urban metro markets are largely exhausted. Penetration in rural and small-town India requires lower prices, more financing options, and a product mix that can withstand income volatility.
However, this optimism comes against the backdrop of slipping market share for Maruti Suzuki and a sharp contraction in the entry-level segment, traditionally the company’s bedrock. Entry-level hatchbacks — once the default choice for first-time buyers — are under pressure from rising ownership costs, regulatory-driven price hikes, and the consumer shift towards SUVs. As Banerjee acknowledges, “Affordability is a challenge… there is another one billion people who are there waiting in the wings to buy, but it will take time.”
A Decade of Nexa: Maruti’s Premium Play
The company has strategically made its move upwards through the Nexa brand, which this year celebrates its 10-year milestone with cumulative sales of over 3.2 million vehicles. This has allowed Maruti to tap into a more affluent customer base, shifting its image from a primarily small-car player to one that can compete in the mid- and upper-end of the market. The premium channel has been positioned to offer a distinct buying experience, higher feature content, and products that appeal to aspirational buyers looking beyond basic mobility.
However, even Nexa will need more models in the higher price bracket — above ₹20 lakh — to keep pace with a market that is rapidly moving upwards. With consumers increasingly willing to spend more on mid- and high-end SUVs, a gap remains between Maruti’s current Nexa lineup and the product depth of leaders like Hyundai, Tata, and Mahindra in these price bands.
Maruti Suzuki’s premium channel, Nexa, has been the company’s answer to changing customer aspirations. Banerjee points out that when Nexa was launched, the average price of vehicles was around ₹4 lakh. “We took it to ₹8 lakh immediately, and now it’s close to ₹16 lakh. That’s the upgradation we’re seeing in the auto industry,” he reveals.
The shift has been strategic — moving from being primarily a small-car company to a full-spectrum player with mid- and higher-end products. However, in the SUV market, Maruti is still seen as a challenger. Rivals like Hyundai, Tata, and Mahindra have built deeper SUV lineups and are galloping ahead in brand equity and segment share.
This push upmarket has brought in more sophisticated buyers. For the Grand Vitara, for example, 57–60% of customers are upgrading from other Maruti models. “This is not just a luxury vehicle for show-offs; it’s for customers who truly understand the sophistication of the car,” Banerjee explains.
Yet, the move towards premiumization also creates a strategic gap — a thinning pipeline of truly affordable cars for first-time buyers. “Everyone cannot upgrade to a ₹20 lakh car. There has to be a middle ground,” he admits, signalling that the upcoming mid-size SUV from the Arena channel could be a key weapon in defending share and attracting value-conscious SUV buyers who may otherwise drift to rivals.
Safety for All: A Non-Negotiable Element
Maruti’s commitment to offering six airbags across almost its entire portfolio — including entry-level models — is a clear response to rising safety awareness. “Safety is paramount for entry-level customers as well… we should not differentiate; every customer deserves the best in safety,” Banerjee says.
This move is also a defensive play against criticism that Maruti lags in crash test ratings compared to some rivals. By making safety features standard, the company is trying to shift the conversation from ratings to overall package value, even as customer expectations continue to rise.
While safety ratings have become a hot topic in the market, Banerjee prefers to focus on the “overall package” rather than just a star score. “It’s not about the 5-star rating; it’s about the trust our customers place in us. We focus on active and passive safety, and that’s more important,” he insists.
The Future: Managing Growth, Cannibalization, and Competition
Even as SUVs now contribute over half of India’s passenger vehicle sales, Maruti’s portfolio expansion in this space is a balancing act. New launches like the Fronx and Grand Vitara have so far avoided eating into the Brezza’s numbers — but competition from Hyundai, Tata, Mahindra, and even newcomers like MG means the fight for share in the ₹10–20 lakh SUV bracket is only intensifying.
The risk is that Maruti’s multi-brand SUV strategy could eventually see diminishing returns if segment growth plateaus and price pressure rises. Global OEMs have shown that premiumization without proportional market expansion can lead to overlap and volume leakage. The new mid-size SUV under Arena will need to deliver not just volume but also differentiation to help Maruti close the gap with segment leaders.
Banerjee remains confident, crediting careful brand positioning. “When we launched the Baleno, everybody said the Swift would get cannibalized. But we sell almost the same number of Swifts. It’s not the product — it’s the positioning that makes the difference.”
Looking Ahead
With India’s car market headed towards 6 million units a year by 2030, Maruti Suzuki’s challenge will be to grow volumes while defending its base. The pivot towards premiumization, stronger safety credentials, and SUV-led growth aligns with changing consumer aspirations — but the company must avoid losing relevance at the bottom of the pyramid, where long-term motorisation still depends.
As Banerjee puts it, “It’s not just about selling cars; it’s about offering the right experience for every customer.” The question is whether Maruti can balance aspiration with accessibility — and convert its challenger status in SUVs into genuine leadership before rivals extend their lead further.