India’s largest carmaker Maruti Suzuki India Ltd. is looking beyond its bread-and-butter small cars to recapture 50% market share in a country obsessed with sports utility vehicles.
That’s according to Hisashi Takeuchi, new chief executive officer at Maruti Suzuki India Ltd., who hosted an investor meet on Thursday to lay out the roadmap for his tenure.
The maker of the Alto to the Grand Vitara aims to restore its operating profit margin to over 10% and recapture market share — the first step to achieve that would be to maximise SUV production as the semiconductor supply normalises.
Key takeaways from the investor meet:
Interest rates on automobile loans in India have risen by less than the repo rate, and the final demand remains strong.
The order backlog stood at 8,00,000 units for the overall industry at last count, and FY23/24 demand will remain solid, bearing in mind that this will be worked off.
Higher sales of CNG vehicles and SUVs are positive for the company’s mix.
The competition’s dependence on diesel powertrains is an opportunity for Maruti Suzuki as real-world driving emission norms kick in from April 2023, UBS Securities said in a note. And as customers gravitate toward CNG/hybrid options, Maruti Suzuki aims to gain even more.
Maruti Suzuki has in recent months introduced CNG variants for its SUVs — the Brezza and Grand Vitara — marking the entry of gas powertrains in a segment dominated by diesel mills.
“We, therefore, expect demand for CNG and hybrids to rise, with CNG being the preferred alternative in compact cars and hybrids in larger cars,” UBS Securities said.