Why Does Maruti Suzuki Still Own More Than 50% Of Indian Automobile Market?

Maruti Suzuki has been operational in India since 1983, where Suzuki established a Joint Venture with Maruti Udyog. This gave rise to what we today call Maruti Suzuki. This marked the beginning of a new era in the Indian automobile industry. Rest, as we all know, was history. Today, even after 37 years of being in our market, the company still enjoys an impressive 51% market share. A ton of companies have come and gone, but no one has been able to overthrow Maruti Suzuki from the top of the list. In this post, we will try to decode the reasons for this success for Maruti Suzuki.

Also read: Check out how Volkswagen performed in December 2020!

The sales figures for December 2020 suggest that Maruti Suzuki sold over 1,40,000 units as compared to over 1,22,000 units in December 2019. This is an increase of more than 14%. Also, 7 out of 10 highest-selling cars in India are Maruti Suzuki products. Considering, this year has been hit by an unprecedented pandemic, these sales figures look even more impressive. The growth of Maruti Suzuki, at least, has been back on the same trajectory as prior to the pandemic. Here is a list of reasons why Maruti Suzuki has continued to stay on top and was not challenged by any other carmaker.

Fuel Economy

We need to understand that our market is still at the evolution stage. We have millions of first-time buyers in our country due to the increasing living standards of our lower-middle-class diaspora. They have always been exposed to Maruti Suzuki products since time immemorial. Also, the first thing they ask from their cars is the mileage of the car. That still plays the most important role for a whole bunch of people before deciding which car to buy. We know, Maruti Suzuki has products with the highest mileage in their respective segments. Maruti knows this very well and calibrates its cars accordingly.

Also read: The compact SUV segment grew 35% in December sales!

Service Network

Being in the country for over 37 years means that market penetration has happened in each and every pocket of the country. India largely being a semi-urban and rural land, it is very difficult for the new players to ever achieve such market penetration so quickly. Till the time they reach all corners of the country, they are not able to stay afloat with their business because of low sales. Maruti Suzuki enjoys that privilege that they have earned through all these years. No matter where you go, you will find a Maruti Suzuki dealer and service network. Therefore, getting your car’s servicing done is not a big deal.

Also read: Ford, Jeep and Kia see substantial decline in sales according to December sales report!

Maintenance Costs

After having brought your car to a service centre, the cost of maintenance including spare parts is very low. This is due to the fact that the spare parts are easily available in the market because everything is manufactured in India itself. Having an abundance of spare parts in the country leads to low prices and easy availability. This leads to very affordable servicing of the cars.

Lack of Competition

This is primarily due to the fact that every new company that comes into our market, does require a lot of factors going their way to challenge Maruti Suzuki. For example, even if a brand comes with a great car, the dealer and service network will not be well established. Then, the cost of ownership will be high because of expensive spare parts and maintenance. Thirdly, the price still plays a huge role. A new company with no volume can’t keep the prices in check without compromising on quality. Maruti Suzuki products are affordable because it manufactures large volumes. A new automaker can’t afford to do that to maintain business.

Also read: Sales Report for December 2020 – Broad overview!

These are some of the reasons we think Maruti Suzuki is enjoying such success even today. However, for the sake of our industry, we are also pleased to see plenty of new players in the Indian market to keep Maruti Suzuki on its feet. The more the competition, the better products we will see in our market.