Carmaker plans to sell about 2 million units to maintain 40% market share by 2016
It took almost three decades for Maruti Suzuki to reach annual volumes of a million cars, but the market leader is confident that rapid domestic market growth will help it reach the next million in just the next three to four years.
Maruti aims to double volumes at home to 2 million cars and utility vehicles by 2016, helping it maintain a 40% share of the market it projects will touch 5 million units by the time, top company executives, including chairman RC Bhargava told suppliers at a conference in Malaysia earlier this month.
With annual output currently at about 1.2 million units across at its Gurgaon and Manesar plants, the major chunk of the fresh capacity — about 0.5 million cars from two lines — will come from its upcoming 1,200 acre mega twin-facility in Gujarat by 2015-16. Meanwhile, the Manesar plant will add a third and the final line later this year with a capacity of 2.5 lakh units a year.
“The company wants to maintain a 40% market share, for which it aims to sell about 2 million by 2016. For this the Gujarat plant, will have to manufacture at least 5 lakh units a year, if not more. It has asked vendors to be tuned to this number in terms of investments on capacity, while improving quality and reducing costs,” a leading supplier said.
So by 2016, the twin Haryana plants would annually make 1.5 million cars, the rest 0.5 million being produced at Gujarat. In fact, the latter is being developed by Japanese parent, Suzuki Motor, as a global small car export hub especially for emerging markets in Africa and South-east Asia.
Bhargava confirmed the development, “We have given our projections on the basis of the last three years and not only the last year which was bad for the industry and does not indicate the future. Gujarat will likely see two plants coming up which together will produce half a million cars, but the final expansion plans will depend on the market demand over the next two years”.
For the entire FY13, Maruti’s market share stood at 39%, though in the last quarter (Jan-March 2013) it had climbed to around 41%. Last fiscal, sales had grown 4.44% at 1.05 million units largely on the back of high demand for its diesel variants for