Maruti Suzuki's Premium Play: Expanding Footprint in the Upmarket Segment
Maruti Suzuki India (MSIL) is intensifying its efforts to establish itself as the preferred choice for India”s urban and affluent populace. The automaker, headquartered in New Delhi, is set to inaugurate 57 new Nexa showrooms, its premium outlets, by March 2025. This strategic expansion is driven by the escalating demand for its high-end vehicles, according to Shashank Srivastava, Senior Executive Officer (Marketing & Sales), who made an announcement recently. Currently, MSIL boasts 468 Nexa outlets, with the first one making its debut in Dwarka, New Delhi, in July 2015.
Intriguingly, Nexa has accounted for 31.9% of MSIL”s total sales until July this year, marking a notable surge from the 22.4% recorded for the entire FY23 (2022-23). MSIL, the country”s largest carmaker, presently offers its top eight out of 17 passenger vehicle (PV) models through Nexa showrooms: Baleno, Ignis, Grand Vitara, Jimny, Fronx, Ciaz, Invicto, and XL6. The remaining nine models are retailed via the company”s 2,842 Arena outlets. In addition, one commercial vehicle, the Super Carry, is distributed through separate commercial outlets.
Recent years have witnessed MSIL intensify its focus on expanding its presence within the utility vehicle (UV) segment, which has been experiencing the swiftest growth. The company has introduced the Grand Vitara, Jimny, Fronx, and Invicto (its first car priced above Rs 20 lakh) in this segment during the past couple of years. This strategic move has enabled MSIL to elevate its market share in the UV segment to 23.12% in the first quarter of FY24, a significant ascent from the 17.4% reported in the corresponding period of the previous year, according to data from the Society of Indian Automobile Manufacturers.
Srivastava said, “MSIL was primarily recognised for reliability, quality, extensive network, cost-effective maintenance, and exceptional value for money. As the economy grew, we realised there existed a consumer segment that prioritised different purchasing criteria.” For this group, design, features, and technology carried more weight than price or fuel efficiency.
In July, among all sales channels in the Indian auto industry, Nexa secured the second position. In FY22, the leading sales channels were Arena, Hyundai, Tata Motors, and Nexa. Srivastava expressed optimism about maintaining this strong performance. Looking ahead, MSIL envisions offering around 28 diverse models, including six electric vehicles (EVs), by FY31. The company”s current lineup includes 18 different models.
Chairman RC Bhargava also highlighted that the company was embarking on its third growth phase called Maruti 3.0. He acknowledged the unprecedented challenges facing the company, emphasizing that it took four decades to establish a capacity of 2 million units. The assistance of Suzuki Motor Corporation (SMC) in establishing the Gujarat facility expedited this process. Now, the company faces the task of adding the next 2 million units within just nine years, as Bhargava explained.
