Maruti Suzuki India Ltd. aims to regain 50% of the passenger vehicle market in the next two to three years, betting on its hybrid models amid high competition in the sports utility vehicle segment.
Currently, non-SUVs contribute 65% of the company's sales, accounting for 33% share in the overall passenger vehicle market. Including SUVs, the company's share in India's car market stood at 42.4% as of August.
To achieve 50% target of the passenger car market, the company requires "35–36% market share in the SUV segment. Currently, we are at 24.5%," Shashank Srivastava, senior executive officer of marketing and sales at Maruti Suzuki, told BQ Prime. "It looks a little tough."
Maruti Suzuki, once known for making one out of every two cars sold in India, lost market share over the last few years as consumers ditched smaller cars for the roomier SUVs, where the Japanese automaker had limited presence.
With the launch of the Grand Vitara, Fronx, and Jimny within a year, the company has claimed the top position in the SUV segment. To achieve the 50% market share target, Maruti Suzuki needs to transition from the top SUV maker to a dominant one in a hotly contested market.
According to HSBC, it would be tough for the company to realise its market share ambitions.
“Although Maruti has gained some ground recently, post the recent launch of Fronx and Jimny, further expansion would be an uphill task as fewer white gaps remain in Maruti's product portfolio," the brokerage said in a recent note.
Market share has peaked in the short term, and the hybridisation of more models could push it further in the medium term, the note said.
Hybrids are a great way to achieve "our emissions target until electric vehicles become mainstream", Srivastava said. The company will consider adding more hybrid versions of the existing models depending on how buyers respond to the hybrid variants of models such as the Grand Vitara and Invicto, he said.
Currently, nearly 22-23% of total Grand Vitara sales come from hybrid variants.
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