Maruti Suzuki is losing market share due to a lack of new product launches, High competition from local players like Mahindra and Tata Motors, and customers’ preference for premium and luxury cars, SUVs, and others.
There is a zigzag pattern in Maruti Suzuki’s Sales growth and regrowth from 2014 to 2024.
Small and Affordable car portfolio was the biggest USP for Maruti. In the current scenario, it has become the biggest challenge. Maruti Suzuki is losing its grip on the common man’s preferred car choice.
Maruti Suzuki is losing market share because its small, affordable, and value-plus cars market share has declined. In 2014, the affordable car segment held a 12% market share, which decreased to just 1% by 2024. Similarly, the Value Plus segment accounted for 63% of the market in 2014, but its share contracted to 48% by 2024. Maruti Suzuki was known for Small and affordable cars. This was one of the reasons that it commanded the Indian passenger Market for decades. In both segments, Maruti Suzuki had a market share of 5% and 37.5% in 2014. In 2024, the company lost grip on both segments. The Maruti lost 10% of its market share in the Value Plus segment and 4% in the Affordable car segment from 2014 to 2024. The overall Indian car and SUV market is moving towards the premium and luxury segments.
To regain the market share, there are two key options:
- Promote affordable Cars like Alto and try to change the market demand
- Align with the market dynamics, accept it, change the Brand perception, and create a product portfolio
Both options are challenging because changing market demand is difficult; usually, this is the approach taken by European OEMs in India. The customer mindset, Economics, per capita income, social life, and culture all have a combined impact on the market dynamics.
Finding space in the premium and luxury segments is also challenging because numerous successful car and SUV models are already present. Brand perception also plays a crucial role in purchase decisions.
Maruti Suzuki Product Strategy:
Maruti needs to enhance its presence in the Premium and Luxury segments. The future trend indicates that these two segments will have impressive growth.
The company needs to work on the Electric car segment as well to maintain its momentum and market share.
Currently, there are no Cars and SUVs available in Maruti Suzuki’s portfolio if buyers upgrade their vehicle to the premium or Luxury segment.
Tata Motors and Mahindra are examples of how they changed the brand perception among Indian buyers. Both Brands are well accepted by customers. Customers are willing to pay a premium for their cars and SUVs.
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