India's largest carmaker Maruti Suzuki on Thursday took its first serious shot at the people mover segment with the launch of the multi utility vehicle Ertiga.
Priced at an aggressive Rs. 5.89 to 7.30 lakh for its three petrol variants and Rs. 7.30 to 8.45 lakh for the diesel versions, the vehicle is expected to be a game changer not only for a product-starved market but also for the firm that has lost its 50% marketshare and is hungry for a rebound.
"Utility vehicles are a promising segment, and we have been largely absent from here so far," said Shinjo Nakanishi, managing director and CEO, Maruti Suzuki India Ltd. "The segment has demonstrated a compounded annual growth rate (CAGR) of 20% over the past three years. We strongly believe that this trend will continue in future and we have to play a role in it."
The segment that accounted for annual sales of 367,012 units in 2011-12 and grew by 16.5% during the year, is spread over a wide spectrum and is dominated by the likes of Mahindra Bolero at the entry level, Xylo and Chevrolet Tavera in the middle and Toyota Innova and XUV5OO at the top end.
Bolero is the largest selling MUV in India with sales of just over 100,000 in 2011-12.
"This is also a global product and hence would be exported as well starting with Indonesia later this month," Nakanishi said.
Once famed for selling every other car in the country, Maruti has seen its marketshare slip to below 40% for the first time in 2011-12 as a sharp shift in consumer preference for diesel vehicles and a troublesome 3-month long labour strife at its new Manesar factory crippled its production. It is banking on Ertiga's incremental volumes to regain some of the lost marketshare though the company played down talks of going above 50% again.
"We have been maintaining our marketshare of around 44-45% in the last 3 years but that went down to 38.4% in 2011-12," said Mayank Pareek, managing executive officer (marketing and sales), MSIL. "Our marketshare this year will certainly go up. By how much...that we have to see."