Maruti Suzuki losing market share as hatchbacks and sedans lose space to SUVs
Maruti Suzuki seems to be losing market share constantly as the demands for hatchbacks and sedans are shrinking to SUVs and MPVs. Despite the biggest automaker of India being far away from being dethroned from its pole position that it has been holding for decades, has witnessed its market share shrinking to 43 per cent in the last fiscal, which is close to the automaker's FY14 market share of 42 per cent. Maruti Suzuki has lost more than eight per cent of market shares in the last three financial years, from 51 per cent registered in FY20.
The Indian passenger vehicle market is witnessing a rapid change in terms of the vehicle preference of consumers. Utility vehicles including SUVs, crossovers and MPVs are finding an increasing footprint in the country, which is shrinking the hatchback and sedans' market share. Once known as the small car market, the Indian automobile space has changed drastically over the last few years.
The automakers that have been focusing on utility vehicle segments have been faring well in the Indian market. For example, Kia which solely focuses on the UV segment in India acquired more than six per cent market share in just three years of operations in the country. Tata Motors has witnessed its market share going up more than 12 per cent in FY22 from 6.8 per cent in FY19. Maruti Suzuki on the other hand is still majorly dependent on small car sales. The automaker has only four UVs in its portfolio - Vitara Brezza, Ertiga, XL6 and S-Cross.
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The Vitara Brezza once used to dominate the compact SUV segment but lack of product innovation and rising competition from rival brands have made matters tougher.
Speaking about Maruti Suzuki's market share slump, automotive and brand strategy expert Avik Chattopadhyay said that, Maruti Suzuki is losing out due to some key reasons. These are having no SUV portfolio, no excitement in the entry-level segment in terms of design and energy variants, and no further differentiation or edge over competition in service standards and reach. He also mentioned that Maruti Suzuki's image has corroded for not being seen as a high-tech or innovative brand anymore.
FY22 witnessed the utility vehicle segment registering more sales than the cumulative figure of hatchbacks and sedans for the first time in the country. While other automakers relied on bringing in new utility vehicles to increase their sales and market share, Maruti Suzuki did nothing as such. It didn't launch any new product in the segment, which affected its sales in the segment. Also, the rival automakers made it more difficult for Maruti Suzuki by launching new products and opting for an aggressive pricing strategy. The problem for the automaker has been compounded as Maruti Suzuki has not revealed any specific product strategy to counter the mounting pressure in the UV segment.