Maruti Suzuki Revenue Increases Via Compacts and Mid Size Sales Only

The mini car segment has been shrinking in terms of revenues at Maruti Suzuki India which is thriving on mid size and compact segment sales only according to company sources.

Over the last couple of years, the super compact and mid size segments have outstripped the mini segment at Maruti Suzuki India. Small is not so beautiful for India’s largest maker of small cars. The mini segment encompasses models like the Wagon R and Alto which now account for a paltry 18.7% of Maruti Suzuki’s total revenues for the 2015 fiscal which is considerably lower than the 22.6% observed in the same period in 2014. However, the compact segment witnessed considerable growth courtesy models like the Dzire Tour and so did the mid size segment with models like the Ciaz. The super compact segment witnessed growth in revenues from 1 to 2.9% while the mid size segment went up to 5.6% as compared to 0.6% earlier.

According to chairman, Mr. RC Bhargava, these trends are reflective of changes in the market. These trends are definitely big indicators for the company as its bread and butter mini segment is steadily shrinking. The company may choose to focus on the Ertiga, S Cross, Baleno or Ciaz but Bhargava stated how the small car segment will never be ignored, particularly first time buyers who are upgrading from bikes to cars.

According to industry experts, consumer buying patterns have evolved due to growing per capita income and this is why the mini segment is witnessing an erosion of customer interest and buying volumes. Consumers are now opting for better cars and Maruti Suzuki has done well in the mid size and compact segments as a result. However, its premium offerings like the Baleno sedan, Kizashi or SX4 have not really garnered huge sales in the market. However, Maruti’s huge customer base enables it to come up with strategic upgrades at every price point and this should certainly augur well for segments which are shrinking or yet to set the stands on fire.


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