Maruti Suzuki banking on Nexa for 15% of total sales by 2020 - The Financial Express

Maruti Suzuki banking on Nexa for 15% of total sales by 2020

The country’s largest carmaker, Maruti Suzuki India, is expecting a 15% contribution to its total sales volumes from its premium retail network, Nexa, by 2020.

By: | Updated: March 19, 2016 7:30 PM

maruti L Maruti is expecting the new network to expand to around 400 Nexa dealerships in the next five years from the 100 outlets it currently has. (Reuters)

The country’s largest carmaker, Maruti Suzuki India, is expecting a 15% contribution to its total sales volumes from its premium retail network, Nexa, by 2020. The company aims to sell 20 lakh units annually by 2020, of which 3 lakh are expected to be sold through the new channel, launched in July last year, officials said on Monday.

In the first six months of its journey, the new channel, which Maruti has launched with a target of providing a ‘premium’ feel to its customers, has witnessed sales of around 45,000 cars — 17,000 units of the S-Cross and 28,000 units of the Baleno — which made up around 10% of its domestic sales in the period. Currently, Maruti sells only two models through the Nexa network.

Moreover, Maruti is expecting the new network to expand to around 400 Nexa dealerships in the next five years from the 100 outlets it currently has. By the end of the current financial year, Maruti expects to have 150 Nexa outlets.

“By 2020, we plan to have around 400 Nexa outlets and by that time, we expect these dealerships to account for 15% of the total sales,” Maruti Suzuki India executive director, marketing and sales, R S Kalsi, said.

Moreover, with the current network of 100 outlets, Maruti has already covered a catchment of 900 traditional dealerships of the company as the dealers owning the Nexa stores also own the traditional dealerships. “This is the fastest retail network any automobile company has ever come up in the entire world,” Kalsi said.

“Suzuki has already said that it plans to launch 20 new products globally by 2020, which 15 will come to India. It will be an ongoing exercise to determine which product would go to what channel,” Kalsi said, in response to queries on the company's future plans with Nexa network.

1.6 litre S-Cross price cut by Rs 2 lakh

Within six months of its launch, Maruti Suzuki India has cut the price of its premium crossover S-Cross by over Rs 2 lakh, as a “correction” measure. Sales volumes for the crossover have seen a constant decline over the past few months. Launched in August last year, its wholesale sales have come down from 4,600 units in its first full month of sales to around 2,200 in December. “Yes, we have undertaken a price correction in prices of the 1.6 litre and since then, sales have picked up,” Kalsi said.

The company had introduced the S-Cross in two variants of 1.6 litre and 1.3 litre engines last year, coinciding with the launch of its premium retail outlet chain Nexa.

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