Maruti Suzuki's CV Raman: ‘Change in buying patterns likely once the lockdown ends.'

by Nilesh Wadhwa 23 Apr 2020

The ongoing global lockdown on the back of Covid-19 pandemic has brought many unprecedented challenges, but on the flip side, it has brought back blue skies and respite from pollution in many of the polluted cities. In a webinar organised by Autocar Professional, on 50th World Earth Day, CV Raman, Senior Executive Director (Engineering), Maruti Suzuki India, shared his views on sustainable mobility.

Raman is known not just for leading the development at the country’s largest carmaker, but also the ability to work on complex challenges using simple solutions. In his presentation during the webinar on 'Driving towards a Greener, More Sustainable Auto Industry', Raman said the pace at which Indian automotive industry leapfrogged from BS IV to BS VI in just three years is a matter of pride. “What Indian engineers have been able to achieve in three years has been actually lost in amidst the Covid-19 pandemic. It was actually a reason to celebrate for the automotive and oil and gas industry. It is interesting to note that BS VI development started before BS VI fuels were made available. For instance, when Europe announced its move to Euro 6 emission norms, the fuel was made available 5 years before the cut-off date.”

Raman spoke about how Maruti Suzuki tackled the BS VI challenge with more than 50 applications being developed simultaneously. With multiple models and variants in its product portfolio, Maruti Suzuki conducted over 250 homologation tests and approximately 60 lakh kilometres of validation tests.

Cost optimisation a key challenge
Raman outlined how Maruti Suzuki India’s engineering team was constantly working to meet the stringent deadline. All this also translated into high cost and investment. He added that “customers do not necessarily want to pay a premium for emissions and safety regulations. We need to therefore look at cost optimisation.”

Listing out the challenges for Maruti Suzuki India, he mentioned the company had to upgrade and expand its facilities for testing and validation, while also taking support from external agencies. This also meant more hiring and upskilling the existing workforce. And new emissions technology at the forefront also meant upgrading its supplier base to localise components, all the while upgrading its own production facilities.

Raman says in order to meet the company’s and the national objective, Maruti Suzuki launched its first BS VI offering, the Alto 800 a year before BS VI came into force. This has helped the carmaker sell a record 750,000 BS VI vehicles in FY2020, more than BS IV vehicles.

Responding to a query on the future of diesel vehicles in the BS VI-era, Raman said that the share of diesel vehicles compared to petrol vehicles has been going down on the back of narrowing gap of diesel and petrol prices. “With BS VI, the prices of diesel vehicles will become quite high. After RDE, the move to SCR systems will further increase cost. From the customer perspective, TCO (Total Cost of Ownership) key, and owning a diesel vehicle will become more of an emotional need versus an economic decision. That’s why in the SUV segment, it may still make sense.”

Vehicle scrappage policy to further reduce pollution
On the issue of sustainability and environmentally friendly alternatives, the speakers were united in their urgent call for formalising a scrappage policy to cut down pollution. “We as automakers need to look at what we can do to improve air quality. The first was BS VI, and the second is to reduce old polluting vehicles, and also look at new alternate energy mix. With the Scrappage Policy, the automotive industry can further reduce carbon dioxide emission by 31%,” pointed Raman.  

The industry veteran said that the government should opt for a technology agnostic approach, which will not only help reduce pollution at a faster level at a lower cost, but also help meet the energy mix needs of the country. He said that the government can promote alternate fuel vehicles (CNG, ethanol, methanol) and hybrids, along with EVs.

The sustainable way forward
Raman suggested four factors that the industry should focus on to achieve sustainable and clean mobility – focusing on energy security, policies to modernise existing polluting fleets, proper infrastructure planning and development to support new-age mobility and focus on development of India specific affordable solutions.

Sharing his views on the market conditions and his expectation of the scenario once the lockdown is lifted, Raman said: “Change in consumerism is likely once the Covid-19 lockdown ends. An attitude change and tendency to save more is likely. People will spend less on luxury and demand for shared mobility is likely to go down in near-term. Digitalisation will see higher penetration, and the work-from-home culture may change the way companies do business, thus limiting the need to travel. We may also see reverse migration. Urban economy may lead to global recession. Companies need to redraw cash-flow strategies. There could be various scenarios and industry needs to take proactive steps for a rapid recovery in the Indian market.”

Collaboration, according to him, will be the way forward, “We will need to collaborate to provide a better environment. I believe India has the potential and the human capital. If there's a collaborative effort from all stakeholders including government, we can solve the current issues that are there and drive towards innovative greener sustainable solutions for customers, keeping in mind the cost, aspiration and needs."

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