Maruti races ahead from tech laggard to pole positionautos Updated: Mar 23, 2016 23:40 IST
Maruti Suzuki has learnt lessons from its competitors. And is going from being a tech laggard to pole position.(HT File Photo)
For decades, India’s largest carmaker Maruti Suzuki was famous for trailing the field on the technology front. In 1998, for instance, Hyundai launched the Santro with multi-point fuel injection, which helped it meet Euro norms and made it more fuel efficient. Maruti was still using the almost-obsolete carburettor technology.
The Swift came seven years after Opel Sail targeted the same buyer. And Hyundai’s Accent and Ford’s Ikon fared better than Maruti’s small sedan, Esteem. However, backed by unparalleled distribution reach and among the lowest after-sales service costs, Maruti continued to reign.
The wake-up call came in 2010, when labour problems rocked the Manesar and Gurgaon plants, and profits plummeted as buyers ditched the simple, cheap, featureless and primarily petro-driven Maruti cars for the more glitzy products from competitors that had the added advantage of diesel engines.
For the first time, it’s share in passenger cars dipped below 40%, it had to act and act fast.
“Importance was given to design and quality – the interiors of the WagonR was changed immediately, and then the Swift’s,” said Raman CV, head of engineering and R&D at Maruti.
In 2012-13, Maruti decided on a new “liquid flow” design language, and let go of the old boxy looks. The hatchback Baleno is the first product of this ethos. ”People said it doesn’t look like a Maruti,” Raman laughs. It was an instant hit; sales crossed 10,000 in December and are ruling at 12,000 a month, including exports, at present.
It also took some bold steps, such as launching a premium dealership network called Nexa. The Baleno and the crossover S-Cross are sold through this network. Maruti gets 12% of its revenue from Nexa, and is angling for more.
In August, Maruti launched the smart hybrid vehicle by Suzuki (SHVS), a patented technology, with the Ertiga and the Ciaz. How does it work: When stationary, the engine automatically cuts off. When the driver floors the gas pedal, it wakes up. And every time he steps on the brake, the energy generated is stored in the battery, and that energy is used to run the car, instead of burning fuel.
The technology improved fuel efficiency by 8-18%, and has proved immensely popular.
“The SHVS technology will help Maruti when the CAFÉ norms are implemented in 2017, which is to bring down the overall CO2 emission by cars of a particular company,” said Raman. Almost 58% of all Ciaz and Ertiga units sold are based on the SHVS platform.
When demand for diesel-driven vehicles peaked, Suzuki made an 800cc diesel engine and put it in the Celerio – again a first for the auto industry. This was not an award-winning idea, though, and the plant capacity remains underutilised, but Maruti does sell 800-1,000 small diesel cars every month.
Also, Maruti started offering airbags as an option in the Alto – that too surprised the industry. “We partnered with Toyota Gosei and Autoliv, to make airbags locally helping cut imports” said Raman. That halved the price disparity between models with and without airbags. However, the percentage of buyers going for airbag variants is in single digits.
Talk of safety, the Vitara Brezza is the first vehicle to be certified for the frontal and side offset impact, regulations for which will come next year.
Then it launched the low cost automatic gear shift (AGS) in the Celerio and the WagonR. At just about Rs 30,000-40,000 more, a buyer can get a two-paddle technology, which eases driving in heavy traffic condition.
And lastly, it was the first -- and till date only -- company to offer the Apple CarPlay infotainment system, in the Baleno.
As a mass carmaker it can take bigger risks. At a time when competitors were converting existing hatchbacks into crossovers, Maruti decided to make the S-Cross pure breed crossover. And in the coming years there are more to come.