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LAUNCHING THE ELECTRIC VEHICLE – MARUTHI SUZUKI INDIA (MSI)

Overview
About the Company – Suzuki Group
 Japan-based company started indian
operations in 1982
 Market leaders in passenger car segment
 Major presence in economic and mid
budget cars
Latest Update (as per the case)
 Indian government decide for
popularising electric vehicle as part of
pollution reduction
 Other competitors with low market share
already have implemented and have
projects for electric vehicle
 Suzuki India have no vehicles in electric
car segment and are in dilemma to launch
electric vehicles or not
Electric car segment in India
 Not a popular choice
 Market share of 1 %
 Mahindra is the only manufacturer in
India
 International players like Nissan & VW
have plans to implement
Electric vehicle launch plans – Other competitors
 Mahindra plans to expand their current
facility. Mahindra also planning to built a
battery manufacturing facility which will
help in reducing manufacturing cost
 Hyundai shelved the launching of hybrid
cars and plans to e-cars by 2020
 Audi India plans to launch e-cars by 2020

Electric car popularising objectives

 The plan is to reduce the dependence on
fossil fuel cars
 Aims to reduce air population which is
becoming severe and affecting health of
citizens badly.
 Reduction in import of Oil

Business Options (Possible Alternatives)

 Option 1: Taking first mover advantage

Advantages Disadvantages
1.Can gain market share in e-vehicles segment. 1. High investment cost.
2.Will help in maintain the market leadership 2. Customer acceptance of e-vehicles. Need to
in passenger car segment have various models as customer expectations
are high.

 Option 2: Taking second mover advantage

Advantages Disadvantages
1. Will know about the customer acceptance 1. May result in losing market share.
pattern and need to focus only that. 2. Government may reduce manufacturing
2.Also current uncertainties about subsidies later
government policies also will also be removed.
3. Investment cost will be reduced

 Option 3: Take 40/60 split between hybrid and e-vehicles

Advantages Disadvantages
1.Helps in slow transition from fossil fuel cars 1. Investment cost be higher
to e-cars 2. Need to focus on two projects at a time
2.Helps maintain market share 3. May hit back if competitor e-cars is a hit
3.Time to analyse about customer behaviour among customers
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Critical Analysis
SWOT Analysis

STRENGTHS WEAKNESSES
 Dealer & servicing network  No cars in e-cars or hybrid car segment
 Current market share  Have not initiated any projects associated
 Customer acceptance of MSI vehicles with e-vehicles
OPPORTUNITIES THREATS
 Rising fuel prises  Launch of e-cars by Indian Competitors
 Government policies on e-vehicles  Successful launch of e-cars by global
 Increasing income of Indian middle class players like Audi & Nissan
population  First mover advantage

PEST ANALYSIS

Political Aspects (P)

1. National Electric Mobility Plan 2020 (2013)

2. FAME Scheme (2015)

3. Registration Ban of New Diesel Vehicles in Delhi (2015)

4. GST (2017) – Increase in tax on premium cars

Economic Aspects (E)

1. Lower Maintenance Costs (Reliability)

2. Import of Lithium Batteries increased the Total Cost.

3. Clarity in Economic Environment isn’t transparent stopping few investors from overseas.

Social-Cultural Aspects (S)

1. Pollution Free and Clean

2. Governments are pushing initiatives

3. The trends are changing. Sales were doubled.

4. People are expecting to be available at an affordable cost with great quality of service.

Technological Aspects (T)

1. Lesser Moving Parts

2. Greater Mileage (3 to 4 times than fuels)

3. Aluminium Ore Deposit in India (Relatively Shorter Life | Avoids Import)

4. Home Chargers are viable (9 hours), until the stations are set. Frequent Breakdowns to be
controlled.

Recommendations
 Maruthi Suzuki India ( MSI) should make investments in e-vehicles
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 Government is drafting policies to promote e-cars . MSI should take this opportunities to establish
e-cars
 MSI is having a wide service network. Along with the investment in manufacturing , MSI should
start investing in upgrading their dealer and service network for easy shift to e-cars
 Major Indian competitors to MSI like Hyundai & Mahindra have their plans of laucnching and
expanding e-vehicles by 2020. Any delay by MSI will affect their future market share.
 No competitors have clear first mover advantage as of now. So MSI can have a first mover
advantage if they invest now.
 MSI being a market leader with 40%+ market share should focus on creating a confidence among
customer with regards to e-cars. This will also make a easy shift to e-cars and help in consolidating
the leadership position
 As per the customer surveys, mileage of e-vehicles and charging time is the major drawback which
keeps customer away from e-cars. So MSI should keep focus on the mileage as well as think of
installing faster charging options with the help of their wide service network.
 MSI should position their e-cars as a solution to rising air pollution and creating a safe atmosphere.
This will also help in winning customer confidence and retain market leadership.