Okay here is the history in one short line.  Maruti Udyog Limited, set up in collaboration with Suzuki, renowned for its experience in making small cars,  by the Indira Gandhi headed Government of India, as homage to her son who wanted to make a car for the masses went on to become not only became the company that made the best selling cars but also incorporated best manufacturing and corporate practices and thereby changed the face of car manufacturing and also the car market permanently.  Now that is not a short sentence (and apologies for that, the Americans would call it a loopy sentence) but it is still one sentence only.  What separated Maruti from other Indian four wheeler manufacturers (read that as Hindustan Motors, Premier Automobiles Limited and Mahindra and Mahindra) was that it continued to compete against itself, raised the engineering bar and along with it the reliability of its products and created a service network which is still unprecedented in its length and breadth, even when it has killed of the competition.  Maruti had the vision to look beyond its nose, into the future and was prepared to take on the toughest of competition whenever it came.

Come it did in the middle of the 1990s, with India struggling to find enough foreign exchange and liberalizing its economy and in the process getting rid of the licence Raj.  All car makers from the world were here.  GM, Ford, Peugeot, Fiat, Honda, Mitsubishi, Mercedes Benz, Hyundai, Toyota and Daewoo.  All the names mentioned here with the exception of the Korean Chaebol Hyundai came in with Indian partners. Daewoo tied up with Toyota’s erstwhile partner for manufacturing light commercial vehicles- DCM,  GM tied up with Hindustan Motors and set up its factory at Halol in Gujarat, Ford collaborated with Mahindra and started operations from the Mahindra facility at Nasik, Peugeot and Fiat both collaborated with Premier Automobiles Limited, Honda with SIEL, Mitsubishi with HM, Mercedes Benz with old partner Tata and Toyota with Kirloskar.

Of all these collaborations it is interesting to note that those companies that tied up with Hindustan Motors almost never took off.  GM for instance came in with the Opel brand and struggled to sell those cars.  They first bought out HM and then dropped the Opel brand and brought in the Chevrolet brand and survived.  Ford had to divorce Mahindra and go it alone and shifted base to Tamil Nadu with its factory near Irunguttukottai.  It took them nearly 20 years to find a product that could produce volumes. Peugeot had all sorts of problems with Premier Automobiles Limited and left the country in a hurry.  Fiat was braver than Peugeot, it bought out Premier Automobiles’ Kurla facility and tried to resurrect the Uno car but to no avail.  It is still fighting to come out of the hole despite having a tie up with Tata for sales and service of its vehicles.

An over confident Mercedes Benz introduced the W124 E Class in India when it had been phased out internationally and the Indian customer cocked a snook at the company by not buying its cars.  Soon Tata and Mercedes parted ways in a friendly fashion and Mercedes reorganized its strategy, a lesson that has proved most useful to BMW and Audi.  Honda’s partner Siel’s shareholding came down to 5% and Toyota proved to another slow moving giant taking calculated steps.  Mitsubishi still has ties with HM and is therefore not a company of consequence in India.  Daewoo’s attempt to grow too fast ended in its crashing world wide and only Hyundai proved to be a serious competitor to Maruti-Suzuki apart from home grown major Tata who late in the 1990s decided to go on its own and take the fight to Maruti Suzuki.

In 2012 it is clear that none of the manufacturers with the exception of Hyundai perhaps have the wherewithal to take the competition seriously to Maruti Suzuki.  Maruti has been the true success story for cars as far as Suzuki is concerned.  In no other markets can anyone see the kind of domination that Suzuki cars enjoy in India.  If you look at statistics you will see that the percentage of cars that Maruti sells in the Indian car market has eroded.  At one time it was over 70% but later came down to near 50%.  But the truth is that Maruti was selling more cars in the 50% market than it did in the 70% market because the market had been considerably widened.  Despite experiencing a crippling strike last year, Maruti could not be overhauled from its numero uno status.  All this can be attributed to Maruti Suzuki’s understanding of the Indian market and its uncanny ability to read what the consumer wants and to give him/her an experience of happy motoring.

The Maruti Suzuki display at the Auto Expo only bolsters this perception of the company.  What may seem to be frivolous, incomprehensible or even eccentric to the casual observer is actually a deliberate study.  This year’s Expo saw for instance two Kei Jidosha cars from Japan, the Palette and the MR Wagon.  To most they just seemed two ugly cars that were standing there for some unknown reason.  The truth is that Maruti Suzuki is studying the market for small cars that pack good space and offer affordable market.  The Kei Jidosha cars in Japan sport high tech 660cc turbo charged engines.  Till the advent of the Tata Nano it was believed that less than 800cc engine in a car would not be viable.  Though the numbers are small, it does seem that the Tata Nano is increasingly finding buyers with its 624cc engine. If you see it in this light then the PaletteSW, Solio and MR Wagon will begin to make sense.  Maruti is exploring the possibility of making more small cars and extend its strangle hold over the small car market.

Suzuki MRwagon at the 11th Auto Expo 2012

Suzuki PaletteSW at the 11th Auto Expo 2012

Suzuki Solio at the 11th Auto Expo 2012

Let us look at the other products on display.  There is one car in the Maruti line up which is a matter of great concern.  The A Star.  It is relatively new car and has replaced the Alto in most international car markets where it carries the Alto moniker.  But in India it has come a cropper with monthly sales plummeting below the one thousand mark.  Maruti has tried to generate some buzz around the car by displaying a cabriolet version of the A Star.  Please look at the thinking.  The perception of the A Star has been that the rear of the car is too claustrophobic thanks to the small window.  When you take the roof of the car then it is all airy.  When you see a car like this in a different light then the perception of the actual production car changes.  People tend to wipe out the negative perceptions that they originally had.  It would be very interesting to see if this strategy of Maruti is actually going to work.  Sales numbers will soon speak the truth.

Maruti Suzuki A-Star Cabriolet at the 11th Auto Expo 2012

Then there is the Omni.  Since its launch in 1983 with minimal changes to the front the Omni has been soldiering on and in the process confounding market analysts completely.  It is widely used as a family car, an ambulance, a panel van and a taxi for five or eight people.  Look at what Maruti did with the Omni in this Expo.  It gave new ideas to Omni buyers who are increasingly business people.  Maruti presented the idea of Cafe on Wheels. We Indians are innovative and when the manufacturer supplies us with one idea we will find ten more around it.  Maruti is ensuring that its nearly three decade old vehicle will still throw up new ideas and therefore will ensure that the product will continue to sell.  With dies and everything else depreciating, it makes total sense to sell old vehicles because they bring in larger margins.  In the small car space new cars have to operate on wafer thin profit margins.  But old cars can become cash cows.  The Omni is one of the cash cows in the Maruti farm.

Maruti Suzuki Omni Cafe On Wheels at the 11th Auto Expo 2012

The Blues Lounge concept of the Ritz a car that sells in decent numbers is yet another instance of Maruti bolstering the image of its product by making it funkier.  The Ritz anyway comes with blue interiors and to position it is a lounge with blues referring to a genre of music, Maruti is sending subliminal messages to its Ritz customers.  Configure your car to your tastes.  Make it a comfortable lounge.  That is the message.  Similarly with the Estilo as well.  While the popular perception about the Estilo is that it is a super flop the reality is that it is a moderate success that sells anywhere between 1500 to 2000 units.  GM, Ford, Fiat et al would like to have a car like the Estilo in their portfolio.  So what if auto journalists and wannabe journalist bloggers say it is a horror.  Maruti by calling it a Dream Liner concept is conjuring images of the Boeing 787 Dreamliner. Again the message is make it your dreamliner.  After all the Estilo is a cheap and cheerful car that is far from bad looking.  Similarly the Wagon R Urbane concept.  Make it look mean and wicked.  Who does not like driving in all black car with alloy wheels and beefed up tyres.  Throw in a couple of projector lamps and you have your own version of the Wagon R.  The SX4 is another slow seller.  Maruti has shown the hatchback version of it which is more funky and it has also put up a mountain terrain cycle on the roof of the sportily done up SX4. Maruti is supplying potential customers with ideas and that is a great way of marketing your products.  Maruti did not have much to do with the Swift, with the car overbooked and many waiting for its delivery.  But it did show the old Dzire.  What are its plans for the old Dzire?  Renaming it and selling it to the taxi segment is the rumour.  Mahindra and Verito watch out.

Maruti Suzuki Ritz BluesLounge at the 11th Auto Expo 2012

Maruti Suzuki Estilo Dreamliner at the 11th Auto Expo 2012

Maruti Suzuki SX4 Sport at the 11th Auto Expo 2012

Maruti also has started showing a new habit since the Expo in 2008.  It shows a concept that becomes reality in two years time, by the next Expo.  In 2008 it showed the A Star concept with Indian design cues, the inspiration supposedly coming from the elephant.  In its production avatar it is watered down but by 2010 the car was in the market internationally as the Alto and as the A Star in India.  In the 2010 Exposition the RIII concept was shown.  This was Maruti’s announcement that it was getting into the MPV space but positioning its vehicle below the Innova.  By this year’s Expo the RIII came out in its production form as the Ertiga.  A compact MPV that can carry 6 to 7 people without the hassles of bulk in the city.  We are sure it will do well.  And this year the concept was a small SUV, a space that everybody is getting serious about.  Ford has shown the EcoSport and Maruti is gunning for this space with the XA-Alpha.  Presumably the XA stands for cross over vehicle while the Alpha stands for what Maruti Suzuki wants to make out of this SUV.  Alpha or Number One.  This is indication that Maruti Suzuki is in no mood to relinquish any segment.  It wants to be Alpha.Maruti Suzuki Ertiga unveiled at the 11th AutoExpo in New Delhi



02 Suzuki XA-α at the 11th Auto Expo 2012


Suzuki XA-α at the 11th Auto Expo 2012 : Side View


What is interesting is the cars that Maruti did not show at the Expo.  One of them has already made it into the market.  The cut short and cut price Dzire based on the new Swift platform.  The other is the Alto based new 800cc to be called the Maruti 800.  This is insurance against the Tata Nano and the Hyundai Eon.  It is rumoured that Maruti is working on the old F series 800cc engine to make it comply with even BSV engine norms.  It is also rumoured that it will be priced below the Rs. 2 lakh mark.  It does seem that Maruti knows how to be the Alpha.  Tough task for the competition to overhaul the leader who has benefitted from being active and agile and not slipping into complacency even when it had no competition. Now if that is not good thinking, then what is?