ENVIRONMENTAL THREAT OPPORTUNITY PROFILE

MARUTI SUZUKI INDIA LIMITED

A BACKGROUND

The automobile industry in India is the ninth largest in the world with an annual production of over 2.3
million units in 2008. In 2009, India emerged as Asia's fourth largest exporter of automobiles, behind
Japan, South Korea and Thailand. Several Indian automobile manufacturers such as Tata Motors, Maruti
Suzuki and Mahindra and Mahindra, expanded their domestic and international operations. India's
robust economic growth led to the further expansion of its domestic automobile market which attracted
significant India-specific investment by multinational automobile manufacturers. In February 2009,
monthly sales of passenger cars in India exceeded 100,000 units.

Maruti Suzuki India Limited is the largest automobile manufacturer in South Asia. Suzuki Motor
Corporation of Japan holds a majority stake in the company. It was the first company in India to mass-
produce and sell more than a million cars. Maruti Suzuki is one of India's leading automobile
manufacturers and the market leader in the car segment, both in terms of volume of vehicles sold and
revenue earned since past two decades.

ENVIRONMENT SCANNING

No doubt Maruti Suzuki has been market leaders in India since past two decades especially in small car
segment with Maruti 800 being the most sold car across India. Its market share has always been over
50% as against other domestic players like Mahindra & Mahindra, Hindustan motors, Hyundai etc; the
latest figure being 55% in the last fiscal year, selling around 792167 cars both in the domestic market and
the exports.

Maruti has around 13 models to offer in the Indian market but barring a few like SX4 or Vitara, Maruti has
always been the FIRST CAR OWNER’s Choice for the Indian markets. It cashes on the huge Indian
population and the strong brand name. It’s a very strong financial base unlike few of its immediate
competitors and so immense opportunity to sustain some products with the whole marketing thing even
when the early response is not quite good, WagonR being the most suited example. Maruti rarely scraps
any car. As a company it has immense brand value and growth prospects.

Biggest strength being the service centers of the company. It has a total of around 2767 service centerds
covering a whooping 1314 cities across India, all the components of Maruti cars are readily available, at
very affordable prices which gives Maruti owners true value for their cars.

THREAT

The biggest threat to Maruti is Globalization. With increase in globalization and world being a common
market place every automobile company is landing or has landed in the small car segment taping the
large customer pool at the base of the pyramid. Tata Nano – the one lakh car being the latest example.
The one lakh tag really attracts customers as owning a car is still a status symbol in India. Considering
Maruti is going to stop the manufacturing of its most popular cars Maruti800, it has to really fill the gap
with its own offering before the competitor take over.
The major competing cars are

Toyota – Prius

Honda – Jazz

Volkswagen – Polo

Chevrolet – Spark

Ford – Figo

Fiat – Palio

Skoda – Fabia

Tata – Indica

Hyundai – Santro

Another threat is the diesel n LPG car segment which gives a tough competition due to low operating
costs. In the past Maruti has been good in responding to this kind of threat by launching its diesel version
cars n cars fitted with LPG arrangement.

Maintaining its market share in the small car segment and having vision of the larger pie is the best
strategy for Maruti.

OPPORTUNITES

Maruti has always been so focused in its core competency of small car segment it has actually left the
Luxury car market totally untouched barring a few car models which are still not doing really well for
themselves,

With the 6th pay commission in picture, lot of money to spend in the hands of the younger generation the
company can tap this market by luxury stylish car; launching a SUV that would be a multipurpose car.
And making the use of the current social change, when husband and wife both are working and people
are not thinking much about spending on car, a second car – projecting there in the buyers mind.
Because any Maruti car is rarely a second car choice in customer’s mind. Its more associated with the
concept of affordability rather than style. So breaking that mindset and projecting itself in a totally new
avatar.

There is a immense customer base in India which can be tapped that too in different segments. India is
an growing economy with rate as high as 9 % and the growth is expected to be there in the coming few
years, utilizing the growing economy’s perk and the growth the automobile sector per say Maruti Suzuki
India Limited has a long way to go.

Nikita Jain

MBA – FT – Marketing

IMS, DAVV