1. Maruti Suzuki, courtesy Vitara Brezza, Ertiga hybrid, now the biggest UV player in India

Maruti Suzuki, courtesy Vitara Brezza, Ertiga hybrid, now the biggest UV player in India

As result of the ever increasing demand for its compact utility vehicle Vitara Brezaa and the hybrid version of the multi-purpose vehicle (MPV) Ertiga, market share of Maruti Suzuki in the first two months (April - May) of the current fiscal has increased to 30.76% in the utility vehicle segment from 26% at the end of the FY 17

By: | New Delhi | Published: June 14, 2017 6:03 AM
After two successive launches by Maruti and Hyundai – Vitara Brezza and Creta – the market share of M&M fell significantly as its two new products – TUV 300 and KUV 100 – did not manage to attract enough buyers. (Reuters)

As result of the ever increasing demand for its compact utility vehicle Vitara Brezaa and the hybrid version of the multi-purpose vehicle (MPV) Ertiga, market share of Maruti Suzuki in the first two months (April – May) of the current fiscal has increased to 30.76% in the utility vehicle segment from 26% at the end of the FY 17. Hence the company is now the biggest player in the utility vehicle segment since Mahindra and Mahindra’s market share has fallen to 26.81% y-o-y during the same period. For almost past one and half decade M&M has been the leader in the segment thanks to products like Bolero, Scorpio and XUV 500. Ever since the emergence of compact utility vehicles with the launch of Ford Ecosport and Renault Duster in 2012, M&M’s market share started to decrease consistently. After two successive launches by Maruti and Hyundai – Vitara Brezza and Creta – the market share of M&M fell significantly as its two new products – TUV 300 and KUV 100 – did not manage to attract enough buyers.

“Most of Maruti’s competitors have a limited number of successful models, which makes it difficult to retain customers or cross-sell products. Maruti, on the other hand, enjoys a virtuous cycle of new and old car sales. A higher number of successful models leads to better cross-selling and upgrades,” said analysts of HSBC in a report.
Maruti Suzuki has been selling average monthly 10,000 units of Vitara Brezza in the domestic market for the past six to eight month and due to the high demand and capacity constraint in the existing plants the average waiting period for the vehicle is almost 20 weeks or 5 months. Ertiga on the other hand has been a steady performer for the company by clocking average monthly volumes in the range of 4,500 to 5,000 units in a month.

The performance of the vehicle improved after the launch of the mild hybrid or the SHVS variant, since it attracted only 12.5% excise duty under the FAME scheme of the union government compared to other vehicles in the segment.
In FY 17, Maruti sold 1,08,640 units of Brezza compared to just 5,000 units in FY 16, while the same for Ertiga increased by 5.08% to 63,527 units during the same period. For M&M, old products like Bolero and Scorpio still draws most of the volumes. In April this year volumes of Brezza increased by 36% y-o-y to 10,653 while Ertiga volumes increased by 22.93% y-o-y to 6,742 units.

“We remain positive on Maruti Suzuki considering a multi-year favourable product lifecycle, improvement in product mix (increasing share of premium products) which will aid increasing realizations and consequently operating margins,” said Motilal Oswal in a report.

  1. No Comments.

Go to Top