Maruti Suzuki India Ltd, India's largest carmaker by sales, posted record annual sales for the fiscal ended March 31, driven by new models and robust demand for existing products.
The country's largest carmaker also increased its market share and had a few successful launches in the premium category.
The company posted a 9.8 per cent jump in total sales at 15,68,603 units in 2016-17 fiscal against 14,29,248 vehicles in 2015-16. The company's domestic sales rose 10.7 per cent at 14,44,541 units during the last fiscal as compared to 13,05,351 during the 2015-16 financial year.
The company also increased its market share over 50 per cent in the year on the back of strong demand for Baleno and Vitara Brezza model.
However, the most important thing happened for the company is its growing dominance in the premium segment. After missing to make a big impact in the premium category in the past, Maruti Suzuki in the last two-years cemented its position in the three top premium categories- premium hatchback, compact SUV and mid-level sedan, where foreign players Honda Cars India and Hyundai Motors India has a strong hold.
MSIL’s compact SUV Vitara Brezza has clocked over 110,000 units in the first year of its launch while premium hatchback Baleno still commands a waiting period of 5-6 months and is not expected to ease in FY2018. Baleno has driven past the 150,000 unit sales in 18 months.
Its premium showroom chain Nexa helped the company to lure customers which earlier shied away from driving a Maruti Car. The company in January introduced hot hatch Ignis in the Nexa Line-up. The upgrade variant of its popular Sedan Ciaz will also be a Nexa exclusive. In 20 months, Maruti Suzuki has set up 250 Nexa dealerships across the country.
“Alto, DZire, Wagon R and Swift continue to remain the top sellers in the Indian market. NEXA has brought in new customers by redefining the car purchase and ownership experience. We continue to see healthy orders for Brezza, Baleno and Ignis and our effort is to improve their availability to minimise wait time for customers,” said R S Kalsi, Executive Director, Sales and Marketing, Maruti Suzuki.
The only concern for the company is its declining supremacy in the mass volume generating entry level segment. The company has been reporting degrowth for quite some months in the segment.
In March, 2017 sales of mini segment cars, including Alto and WagonR, declined 15.6 per cent to 30,973 units from 36,678 units in the year-ago month.
Maruti’s small cars are facing tough competition from Renault kwid and Tata Tiago. Both the companies clocked a strong double digit growth in FY2016-17.
Nonetheless, major competition for MSIL continues to come from South Korean automaker Hyundai Motor India(HMIL). Like Maruti, Hyundai also recorded a record breaking sale in the FY2016-17. Hyundai reported a 5.2 per cent increase in sales, from 484,324 units in the previous fiscal to 509,707 units in FY17.
HMIL, senior vice president, sales & marketing, Rakesh Srivastava said the company was able to close the financial year with highest-ever sales creating a strong momentum for the next year.
The company recently said that over the next four years the company would launch 10 products. Of these, eight will be new models and the remaining upgrades of the existing models.
Hyundai aims to invest $2 billion in India over the next five years to develop and upgrade products. It also aims to expand its market share from the current 17 per cent.
BW Reporters
The author is Senior Correspondent with BW Businessworld
