The country's largest car maker Maruti Suzuki India Ltd expects the automobile market to grow much faster than projected to reach annual sales of 4.55-4.6 million cars by 2015. At present, the market is at less than 2 million cars in a year.
With car majors including Toyota, Volkswagen, Nissan and Renault upping investments in the country, the company admitted it may not be able to hold on to its current market share of over 50 per cent.
"The industry is on the verge of attaning the critical mass, which is required for the jump to the next level," said Mayank Pareek, executive officer, marketing and sales, Maruti Suzuki India Ltd. "Looking at the demographics, we will far exceed the 3 million sales figure projected for 2015. My bet is that industry sales could be as high as 4.55-4.6 million. At that level, marketshare loses meaning. Our aim is to be in a dominant leadership position."
The domestic industry has grown by 13 per cent over the last five years, making it the fastest car market in the world, second only to China. At present, there are 14.5 million families with household income of over ₹2 lakh per annum. The number is expected to grow and reach 49 million by 2015.
"Of this 49 million will have a household income between ₹2 and ₹5 lakh, making them consumer for cars," Pareek said. "We will predominantly remain a small car market despite all the theories of market graduating from small to big cars. At the end of the day, the Indian consumer will always look for value for money."
Bulk of the competition is concentrated in the premium hatchback segment where Maruti is the leader with Swift and Ritz. Though new entrants like Ford Figo and Chevrolet Beat are priced well below, Maruti refused to join the price war and insisted there will be no reduction in prices. "We do not believe in reducing prices except when an excise cut is announced," Pareek said. "We will not join the price war."
Maruti's sales and service network is also set to get sharper with increased volumes. "In 2009-10, we aggressively expanded our sales and service network and my ultimate aim is to have 1,500 dealerships so that the company has a presence in every small town with a population of 50,000," Pareek said.