Maruti’s Nexa network moves ahead of its peers

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Updated: April 1, 2016 6:20:15 PM

With just two models in its portfolio and over six months of operations, Maruti Suzuki's Nexa network has moved ahead of the European and American automobile players in the Indian market in sales volume.

With just two models in its portfolio and over six months of operations, Maruti Suzuki’s Nexa network has moved ahead of the European and American automobile players in the Indian market in sales volume. In the August-February period of the year 2015-16, Maruti’s domestic sales from the Nexa chain was ahead of players like Ford, Renault and Volkswagen.

The good show by Nexa has been on the back of the success of Maruti’s premium hatchback Baleno. Launched in October, 2015 the car has notched up a total sales of around 40,000 so far.

“We jumped in to the field only after extensive ground work and research. The response to Nexa has in fact exceeded our own optimistic estimates,” Maruti Suzuki India’s sales and marketing executive director RS Kalsi said.

The company is aiming at closing the year 2015-16 with sales volume of 70,000 units, which will again be higher than some players in the market with a wider network. In 2016-17, Maruti will add two more products to its Nexa portfolio, the hatchback Ignis and the Baleno RS. At the same time Maruti is planning to double the Nexa network from 125 at present to 250 by end FY17.

Though the initial response to the S-Cross, which was the company’s first model in the new network, could not create enough excitement in the market, a significant price correction within six months of the launch has now stabilised the sale of the crossover. On the other hand, the premium hatchback Baleno has been a success and continues to be sold on a waiting period.

Analysts point out that the major flaw in the strategies of most foreign OEMs in India has been the lack of consistency when it comes to bringing in good products to the market. “What we have seen in the past five years is that these companies rely heavily on a single product for a long time. Any product, howsoever good, has to face brand fatigue after about two years. So these brands lose market share if they do not come up with upgrades and new products from time to time,” Abdul Majeed, partner at Price WaterHouse said.

At the same time, Nexa has a backing of the Maruti brand. “When customers enter a Nexa showroom, they are completely aware that it is a Maruti product. That adds confidence to the experience of a premium product,” Majeed said.

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