The newly-launched Maruti Suzuki 4th generation Epic New Swift, in Gurugram.
Credit: PTI photo
New Delhi: Maruti Suzuki India on Thursday said it will not give up on small cars and would 're-energise' the segment as it expects the category to revive over the next few years, according to MD & CEO Hisashi Takeuchi.
Although the fall of the company's entry-level small car Alto, from being the largest selling model for a long time to not featuring in the top ten best-selling models in the country anymore, makes him 'sad', Takeuchi said, it was inevitable due to the evolution of the car market in India.
Speaking at the launch of the new generation of its premium hatchback Swift here, he noted that the company would continue to refresh its small car portfolio while also filling gaps in its product portfolio as it aims to cater to the diverse needs of customers as it aims to sell 40 lakh units by 2030-31.
Takeuchi noted that the entry-level segment continues to be a high volume vertical even as the demand for SUVs continues to grow unabated.
"For us to maintain a leadership position, it is important to cater to diverse customer segments. The hatchback segment in India continues to be a high-volume segment, accounting for approximately 28 per cent of total passenger vehicle sales," Takeuchi said.
Interestingly, the premium hatchback segment contributes nearly 60 per cent of total hatchback sales, he noted.
"As a market leader, we took the responsibility to re-energise the hatchback segment at a time when this segment really needs a catalyst for growth," Takeuchi said.
He noted that the company has a strong belief in India's growth story.
"As the government aims to make India a developed country by 2047, we can expect increased economic activity and robust demand for automobiles in the coming years" Takeuchi stated.
With only 32 vehicles per 1,000 people compared to over 600 in developed countries like Japan, India presents a vast pool of car aspirants, he said.
"As car ownership rises, the hatchback segment will serve as an entry point for many customers, and thus shall expand," Takeuchi noted.
Therefore, the hatchback segment will continue to remain relevant for India, and the company's focus on this segment will persist, he added.
The auto major expects the premium hatchback segment to grow to 10 lakh units per annum by 2030 from 7 lakh units currently.
The small car segment, which had once dominated the Indian total passenger vehicles market, accounts for less than 30 per cent at present.
Takeuchi said the company would like to maintain a high market share in the hatchback segment.
"The situation is very good for us as everybody has stopped selling hatchbacks, so therefore the total market may have declined but our share is very high," he said.
Maruti Suzuki currently has a market share of around 69 per cent in the small car segment.
Takeuchi noted that sooner or later with economic growth picking up, people will again start buying the hatchbacks and then the company's high market share will help it a lot.
"So we will not give up on the segment. Our strategy is to have products in every segment in an adequate manner," he stated.
When asked if the company would look at introducing a small electric car, Takeuchi stated that the company aims to introduce EVs at multiple price points.
The company's first EV model would come with an SUV body style, he stated.
Replying to a query regarding Alto not being the best-selling car anymore, Takeuchi said: "Generally in the market, the preference of the people towards the car will not be the same all the time, so it's changing.' He further said: 'So I am sad...India's economy is growing and people will have different choices. In the past, there were not so many choices available and the buying power of people was also limited. But now people are growing, the economy is growing and more choices are available."
Takeuchi noted that India continues to be an important market for Suzuki.
"Our long-term goal is to produce and sell a total of four million units annually, including exports," he added.
The new Swift is priced between Rs 6.49 lakh and Rs 9.64 lakh (ex-showroom Delhi).
Takeuchi said the automaker has invested around Rs 1,450 crore towards the development of the premium hatchback.
This includes investment in tools and dyes for the vehicle as well as the new and more environment-friendly Z-Series engine, he added.
The model would be manufactured at Suzuki Motor Gujarat, from where it will serve customers in India as well as in overseas markets, Takeuchi said.
The new Swift, with a 1.2-litre petrol engine and six airbags as standard fitment, returns a fuel efficiency of up to 25.75 km per litre, marking a 14 per cent enhancement over the last generation model.