FE Editorial : Maruti’s long drive

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The Financial Express:  Nov 29 2012, 03:57 IST
for all cars today. By 2005, partly as a result of the booming Indian market, Maruti was producing more cars in India than were being produced in Japan for the home market and, by 2006, Suzuki was bringing in 3,000 of its dealers and sub-dealers to study the way Maruti was being run and how its dealerships were structured. Today, Maruti accounts for around a fifth of Suzuki’s global sales and around 40% of profits if you include what Maruti pays by way of royalties and other payments like the kits that are imported (30% if you exclude these).

While Maruti has benefited from the extensive vendor base that Suzuki helped set up right from the time it entered the Indian market in the mid-1980s, the larger upgradation of India’s technical skills has played a major role. Which is why engineering exports rose from 15% of total exports in 2000-01 to around 22% in 2011-12—in terms of value, they grew 10 times. That again, is not surprising given the dramatic jump in quality levels. India has around 30 companies who have the prestigious Deming quality award today as compared to around a tenth a decade ago. In terms of the Japan Institute of Plant Maintenance’s Total Productive Maintenance awards, the number has nearly doubled to around 200 today. The Nano, and other examples of frugal engineering like it, aren’t that surprising given this track record.

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