Maruti Suzuki aims to grow by 15-16% in FY24, eyes output of 2.28 million

Maruti Suzuki, the country's largest carmaker is planning to grow at more than double the market growth in FY24, led by incremental sales coming from the new range of SUVs. 

According to several people in the know, the company is planning to increase its output by 15-16% to 2.278 million in the current financial year, over the 1.96 million units it produced in FY23. 

Autocar Professional learns that Maruti Suzuki is eying similar growth in domestic sales, to around 1.86 million units in FY24, thanks to the incremental sales it expects from the new range of SUVs. The exports are likely to grow at a  pace close to 3 lakh units. 

Confident of sustaining the growth momentum in the future, Maruti Suzuki last week announced plans of creating almost 2 million units in capacity between 2024 to 2030, with the company's board giving in-principle approval for an incremental 1 million units capacity beyond 1 million capacity scheduled to kickstart at Kharkhoda, Haryana to cater to the future growth.

Post the Q4 earnings, R C Bhargava, the company's chairman guided for a market outperformance in FY24 without defining the specific growth rate. 

Shashank Srivastava, Senior Executive Officer, Sales and Marketing at Maruti Suzuki said, "The industry will grow 5-7% we still retain that forecast, Maruti will grow faster than the industry, how much faster, we are not specifying. We will grow faster due to new SUVs - Fronx and Jimny, which will be on roads this year and also the first full year volumes of Grand Vitara, this will propel our sales momentum." 

Maruti Suzuki is aiming for SUV leadership, due to incremental sales of Fronx, Jimny, and Grand Vitara which may bring in volumes of over 2-2.25 lakh units.

"We expect the SUV segment to continue to grow faster, the hatchbacks are likely to remain flat in FY24. Our market share was 12% in FY23, even if we were to do a 23%-24% share, we will be the leaders in SUV in FY-24. We closed Q4 with a market share of 17% and the incremental volumes of Fronx and Jimny are yet to be seen," said Srivastava. 

With the share of SUVs expected to rise to 45-47% of the overall market in FY24, with the outperformance, the company would look at reversing the market share trajectory, which had seen the company’s market share fall to an 8-year low of 41.7% on the back of limited SUV alternatives.

As per the production plan accessed by Autocar Professional, Maruti Suzuki will be producing over 5.5 lakh SUVs in FY-24, and if one were to include Ertiga and XL6, the largest car maker will be producing over 7.5 lakh UVs in the current financial year. 

The company was sitting on an order book of a little over 4 lakh units in April and it continues to face a shortage of semiconductor chips - which is leading to lower stock at dealerships and lower share. 

To be sure, the Indian passenger vehicle market is set to witness a slowdown in growth to 5-8% as per industry players, on account of rising vehicle prices, increased inflation, and overall softening of GDP. 

Experts say a majority of the pent-up demand is satiated and the market is back to the strong fundamentals of economic growth, and the new model launches definitely come in handy to lure the fence-sitters. 

Maruti Suzuki, on its part, launched 4 all-new models and 3 major facelifts in FY23, which is likely to pay dividends this year.