Competition important to develop Maruti Suzuki: Kenichi Ayukawa

Auto Expo 2020 saw the introduction of at least two new car brands in India. With growing competition from existing set of newcomers, and more to come, the job for market leader Maruti Suzuki is well cut out

By Sumantra B Barooah calendar 19 Feb 2020 Views icon16730 Views Share - Share to Facebook Share to Twitter Share to LinkedIn Share to Whatsapp

India is a unique and complex market, replete with high price sensitivity to varied customer preferences.  In such a market, Maruti Suzuki is in an unusual and envious position with a 50 percent share in a market of over 3 million units annually. But with a fresh wave of competition, of a new scale, is a 50 percent share sustainable or realistic anymore?

The jury is out on that but Kenichi Ayukawa, MD and CEO, Maruti Suzuki feels new competition will fuel growth. "Yes, because if a competitor is coming, it’s a good chance to grow. 'OK, we are 50 percent, we cannot develop any more', that doesn’t make sense. If a strong rival comes and provides a good product, we try to compete by developing a better product. These cycles are very important to develop the industry and  our company."

Auto Expo saw the introduction of three new car brands — Haval and GWM (EVs) by Great Wall Motors and Haima by First Automobile Works. While Haima is yet to finalise its India entry strategy, Great Wall will launch its first model of the only-SUV brand Haval next year. Currently, Maruti Suzuki  has only one SUV, the Vitara Brezza, in its line-up. So, is the electric SUV concept Futuro-e, a sign of what could come to a Maruti showroom in the not-so-distant future? "We have showcased the concept vehicle and are expecting some response from the customers — good, bad, or exciting. Through that, we are preparing our future product. Of course, it’s very difficult to transfer 100 percent of what's shown into mass production vehicle," says Ayukawa.

The conceptualised-in-India Futuro-e concept points to a new design direction for future models. "This is a new design study we undertook and believe we need to change our design language for the future young aspirational Indian customer," says CV Raman, senior ED, Engineering. The Futuro-e,  Maruti's  first coupé-style SUV concept, is designed to be future-proof with provision for electrification. 

It will be crucial for Maruti Suzuki to ride the SUV wave better. While it dominates the PV market with a 50 percent share, its share in the UV segment is half of that, having dropped from 28 percent last year as the segment grows, thanks to all newcomers like Kia and MG choosing it like a port of India entry. Maruti Suzuki will have to fight against them and more to grow in the UV segment, and protect its overall turf too. Won't be an easy game but Ayukawa believes Maruti Suzuki has a "lot of room to develop by ourselves". And he's game for a healthy fight. "I believe serious fights make the company very strong." He adds that when a new competitor comes, it also makes the company consider how to develop better products, and sell better too. 

For now, the immediate goal for Ayukawa and his team would be to tackle the ongoing slowdown better. In his career of over 30 years, only the first five were "very happy years", after which the seasoned executive has seen many tough times. Like the  Japanese philosophy of doing things simpler, he has a simple approach to tide over tough times — "We try to do together with our people and make efforts, set our target, and find out how we can achieve that target. That is the only way to solve this kind of a problem," says Ayukawa. He expects the market to be in the slow lane for some time and growth to return gradually in FY2021.

(This article was first published in the February 15, 2020 issue of Autocar Professional)

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