While Maruti Suzuki India controls more than half of the entire automobile market, it would be interesting to see if the country’s largest car maker is able to hold onto the disproportionate market share post the advent of electric vehicles in India. In an interview to ET Now, Deven Choksey, MD of KR Choksey Investment Managers said that the company has visibility for at least next two years.
“They continue to hold 50-52% kind of market share in the space in which they are operating passenger vehicles. Going forward, by 2020 electric vehicles would be the new thing to watch out for. Many companies would have already entered into that particular space including the likes of Tata Motors. The current positioning of Maruti suggests that they have got good visibility at least for next two to three years on the launch of the models and sustaining the market share that they are basically enjoying currently,” he told the channel.
Earlier last month, Maruti Suzuki signed a pact to with Toyota Motor Corporation to roll out electric cars in India. The Japanese car-maker entered into an in-principle agreement with Maruti Suzuki to consider a joint structure for the introduction of electric cars in India in 2020. The Indian car-manufacturer’s parent Suzuki said in a statement, “ Suzuki will manufacture electric cars for India and supply some units to Toyota,” adding that Toyota will also provide technical support. Further, both companies plan to incentivize the acceptance of electric vehicles in India by conducting studies on car charging stations, training of technicians, and systems for the disposal of electric car batteries.
Last week, the car-maker reported a 14.3% rise in total domestic passenger vehicle to 1,44,297 units in November 2017. The company has registered a strong volume increase in domestic utility vehicles segment under by 34% to 23,072 units. This increase is backed by an increase in demand for Vitara Brezza, S-Cross, Ertiga and others.
Sharing his outlook on the company, Deven Choksey said, “In case of Maruti you see the new model contributing systematically and if you see the last month data, the smaller car business is basically not growing as much as the mid-tier segment where the company is not only generating higher amount of volume but also making sizable profits.” Maruti Suzuki shares were trading at Rs 8,534, up by more than 0.4% on Tuesday morning.