Maruti Suzuki India Limited

Maruti and formerly

known as Maruti Udyog Limited, is an automobile manufacturer in India.[8] It is a subsidiary of
Japanese automobile and motorcycle manufacturer Suzuki.[7] As of November 2012, it had a
market share of 37% of the Indian passenger car markets.[9] Maruti Suzuki manufactures and
sells a complete range of cars from the entry level Maruti 800, Alto, to the
hatchback Ritz, Celerio, Ciaz, A-Star, Swift, Wagon R, Zen and sedans DZire, Kizashi and SX4,
in the 'C' segment Eeco, Omni, Multi Purpose vehicle Suzuki Ertiga and Sports Utility
vehicle Grand Vitara.[10]
The company's headquarters are at No 1, Nelson Mandela Road, New Delhi.[2] In February 2012,
the company sold its ten millionth vehicle in India.[11]
Contents
[hide]

1 History
o 1.1 Chronology
2 Joint venture related issues
3 Manufacturing facilities
4 Industrial relations
o 4.1 Manesar violence
5 Products and services
o 5.1 Current models
o 5.2 Discontinued models
o 5.3 Sales and service network
o 5.4 Maruti Insurance
o 5.5 Maruti Finance
o 5.6 Maruti TrueValue
o 5.7 N2N Fleet Management
o 5.8 Maruti Accessories
o 5.9 Maruti Driving School
6 Exports
7 Awards and recognition
8 See also
9 References and notes
10 External links

History[edit]

Logo of Maruti Udyog

Maruti Udyog Limited was established in February 1981, though the actual production
commenced only in 1983. It started with Maruti 800, based on theSuzuki Alto kei car which at
the time was the only modern car available in India. Its only competitors were Hindustan
Ambassador and Premier Padmini. Originally, 74% of the company was owned by the Indian
government, and 26% by Suzuki of Japan.[12] As of May 2007, the government of India sold its
complete share to Indian financial institutions and no longer has any stake in Maruti Udyog.[13]

Chronology[edit]
Beginnings
Maruti's history begins in 1970, when a private limited company named 'Maruti technical
services private limited' (MTSPL) is launched on November 16, 1970. The stated purpose of this
company was to provide technical know-how for the design, manufacture and assembly of "a
wholly indigenous motor car". In June 1971, a company called 'Maruti limited' was incorporated
under the Companies Act and Sanjay Gandhi became its first managing director. "Maruti
Limited" goes into liquidation in 1977. On 23 June 1980 Sanjay Gandhi dies when a private test
plane he was flying crashes. A year after his death, and at the behest of Indira Gandhi, the Indian
Central government salvages Maruti Limited and starts looking for an active collaborator for a
new company. Maruti Udyog Ltd is incorporated in the same year.[14]
Suzuki enters
In 1982, a license & Joint Venture Agreement (JVA) is signed between Maruti Udyog Ltd.
and Suzuki of Japan. At first, Maruti Suzuki was mainly an importer of cars. In India's closed
market, Maruti received the right to import 40,000 fully built-up Suzukis in the first two years,
and even after that the early goal was to use only 33% indigenous parts. This upset the local
manufacturers considerably. There were also some concerns that the Indian market was too small
to absorb the comparatively large production planned by Maruti Suzuki, with the government
even considering adjusting the petrol tax and lowering the excise duty in order to boost
sales.[15] Finally, in 1983, the Maruti 800 is released. This 796 cc hatchback is based on the SS80
Suzuki Alto
I

affordable car. Initial product plan is 40% saloons, and 60%

[15]
Maruti Van. Local production commences in December 1983.[11] In 1984 the Maruti Van, with
the same three-cylinder engine as the 800, is released. Installed capacity of the plant in Gurgaon,
reaches 40,000 units.
In 1985 the Suzuki SJ410-based Gypsy, a 970 cc 4WD off-road vehicle, is launched. In 1986 the
original 800 is replaced by an all-new model of the 796 cc hatchback Suzuki Alto/Fronte. This is
also when the 100,000th vehicle is produced by the company.[14][dead link] In 1987 follows the
company's first export to the West, when a lot of 500 cars were sent to Hungary. Maruti products
had been exported to certain neighboring countries already. By 1988, the capacity of the
Gurgaon plant is increased to 100,000 units per annum.
Market liberalisation
In 1989 the Maruti 1000 is presented after having been shown earlier. This 970 cc, three-box is
I

p
sedan. By 1991 65 percent of the components, for all vehicles
produced, are indigenised. Meanwhile, the liberalisation of the Indian economy opens new
opportunities but also brings more competition to the segments in which Maruti operates. In
1992 Suzuki increases its stake in Maruti to 50 percent, making the company a 50-50 JV with the
Government of India the other stake holder.

A flow of new models begin in the early nineties. In 1993 the Zen, a modern 993 cc, hatchback
which is later exported globally as the Suzuki Alto. In 1994 the 1298 cc Esteemappears, a more
luxurious redesigned Maruti 1000. This and other Marutis begin appearing in a plethora of
different equipment levels, to better suit India's increasingly discerning consumers. A Zen
Automatic arrives in 1996, as does the Gypsy King, a 1.3 liter version of the compact off-roader,
and a minibus version of the Omni (the Omni E).
In 1994 Maruti Suzuki produces its 1 millionth vehicle since the commencement of production,
being the first company in India to do so. This is still not enough in a booming market and the
next year Maruti's second plant is opened, with annual capacity reaching 200,000 units. Maruti
also launches a 24-hour emergency on-road vehicle service, the first of its kind in the country. In
1996 the United Front government is formed, with Murasoli Maran new Industries Minister. On
27 August the following year the government nominates Mr. S.S.L.N. Bhaskarudu as the
Managing Director, as the then current Managing director R.C. Bhargava, was completing his
tenure. This creates a conflict withSuzuki, discussed closer in the Joint venture related issues
section.
In 1998 the new Maruti 800 is released, the first change in design since 1986. This is simply a
facelift of the existing model, to ensure steady sales. Also, the two millionth vehicle is produced.
Other news include the Zen D, a 1527 cc diesel hatchback and Maruti's first diesel vehicle.
The Omni van and microbus is also redesigned. The next year the Omni bus arrives in a high
roof version, the Omni XL. The 1.6 litre Maruti Baleno three-box saloon, advertised as the
'Maruti Suzuki Baleno', also appears. This is Maruti's biggest car yet. Finally, in what is a very
busy year, the Wagon R is launched.
In 2000 Maruti becomes the first car company in India to launch a Call Center for internal and
customer services. The new Alto model is also released, somewhat larger and more modern than
the 800. The estate Baleno Altura is also shown, while IDTR (Institute of Driving Training and
Research) is launched jointly with the Delhi government to promote safe driving habits. In
2001 Maruti True Value, selling and buying used Maruti Suzukis, is launched in Bangalore and
Delhi, later in Mumbai and elsewhere. In October of the same year the Maruti Versa sees the
day, a bigger engined and more luxurious microbus than the Omni. It never catches on in the
market and is discontinued by late 2009, only to be replaced by a cheaper, stripped-down version
called Eeco. Customer information centers are also launched in Hyderabad, Bangalore and
Chennai. In 2002 theEsteem Diesel appears, as does Maruti Insurance. Two new subsidiaries are
also started: Maruti Insurance Distributor Services and Maruti Insurance Brokers Limited.
Suzuki Motor Corporation increases its stake in Maruti to 54.2 percent.
In 2003 the new Suzuki Grand Vitara XL-7 appears, while the Zen and the Wagon R are
upgraded and redesigned. The four millionth Maruti vehicle is built and they enter into a
partnership with the State Bank of India. Maruti Udyog Ltd is Listed on BSE and NSE after a
public issue, which is oversubscribed tenfold. In 2004 the Alto becomes India's new best selling
car, overtaking the Maruti 800 which had been number one for nearly two decades. The fiveseater Versa 5-seater, a new variant, is created while the Esteem undergoes cosmetic changes and
is re-launched with a price cut. Maruti Udyog closed the financial year 2003-04 with an annual
sale of 472,122 units, the highest ever since the company began operations 20 years earlier, and
the fiftieth lakh (5 millionth) car rolls out in April, 2005, with overall sales growing by 15.8%.
The 1.3 L Suzuki Swift five-door hatchback also appears. 2004-05 marked another record year

(487,402 domestic sales) and exports reached 48,899 cars to about fifty different countries. The
United Kingdom took the lion's share, with 10,623 deliveries.[16]
In 2006 Suzuki and Maruti set up another joint venture, "Maruti Suzuki Automobiles India", to
build two new manufacturing plants, one for vehicles and one for engines.[16]Cleaner cars were
also introduced, with several new models meeting the new "Bharat Stage III" standards.[16] In
February 2012, Maruti Suzuki sold its ten millionth vehicle in India.[11] For the Month of July
2014, it has a Market share of >45 %.[17]

Joint venture related issues[edit]

Relationship between the Government of India, under the United Front (India) coalition
and Suzuki Motor Corporation over the joint venture was a point of heated debate in the Indian
media until Suzuki Motor Corporation gained the controlling stake. This highly profitable joint
venture that had a near monopolistic trade in the Indian automobile marketand the nature of the
partnership built up till then was the underlying reason for most issues. The success of the joint
venture led Suzuki to increase its equity from 26% to 40% in 1987, and further to 50% in 1992.
In 1982 both the venture partners had entered into an agreement to nominate their candidate for
the post of Managing Director and every Managing Director will have a tenure of five years[18]
R.C. Bhargava was the initial managing director of the company since the inception of the joint
venture. Till today he is regarded as instrumental for the success of Maruti Suzuki. Joining in
1982 he held several key positions in the company before heading the company as Managing
Director. Currently he is on the Board of Directors.[19] After completing his five-year tenure, Mr.
Bhargava later assumed the office of Part-Time Chairman. The Government nominated Mr.
S.S.L.N. Bhaskarudu as the Managing Director on 27 August 1997. Mr. Bhaskarudu had joined
Maruti Suzuki in 1983 after spending 21 years in the Public sector undertaking Bharat Heavy
Electricals Limited as General Manager. In 1987 he was promoted as Chief General Manager. In
1988 he was named Director, Productions and Projects. The next year (1989) he was named
Director of Materials[clarification needed] and in 1993 he became Joint Managing Director.[citation needed]
Suzuki did not attend the Annual General Meeting of the Board with the reason of it being called
on a short notice.[20] Later Suzuki Motor Corporation went on record to state that Bhaskarudu
was "incompetent" and wanted someone else. However, the Ministry of
Industries, Government of India refuted the charges. Media stated from the Maruti Suzuki
sources that Bhaskarudu was interested to indigenise most of components for the models
including gear boxes especially for Maruti 800. Suzuki also felt that Bhaskarudu was a proxy for
the Government and would not let it increase its stake in the venture.[21] If Maruti Suzuki would
have been able to indigenise gear boxes then Maruti Suzuki would have been able to
manufacture all the models without the technical assistance from Suzuki. Till today the issue of
localization of gear boxes is highlighted in the press.[22]

Manufacturing facilities[edit]
Maruti Suzuki has two manufacturing facilities in India.[23] Both manufacturing facilities have a
combined production capacity of 14,50,000 vehicles annually. During a recent meeting of the
Gujarat chief minister with Suzuki Motor Corp chairman & CEO Osamu Suzuki,the Chairman

had said that the work on car manufacturing plant at Mandal near Ahmedabad would be started
soon.[24] Maruti Suzuki to set up second plant in Gujarat; acquires 600 acres.
The Gurgaon manufacturing facility has three fully integrated manufacturing plants and is spread
over 300 acres (1.2 km2).[25] All three plants have an installed capacity of 350,000 vehicles
annually but productivity improvements have enabled it to manufacture 900,000 vehicles
annually. The Gurgaon facilities also manufacture 240,000 K-Seriesengines annually. The entire
facility is equipped with more than 150 robots, out of which 71 have been developed in-house.
The Gurgaon Facilities manufactures the 800, Alto,WagonR, Estilo, Omni, Gypsy, and Eeco.
The Manesar manufacturing plant was inaugurated in February 2007 and is spread over 600
acres (2.4 km2).[25] Initially it had a production capacity of 100,000 vehicles annually but this was
increased to 300,000 vehicles annually in October 2008. The production capacity was further
increased by 250,000 vehicles taking total production capacity to 550,000 vehicles annually. The
Manesar Plant produces the A-star, Swift, Swift DZire, SX4, Ritz and Celerio.
On 25 June 2012, Haryana State Industries and Infrastructure Development Corporation
demanded Maruti Suzuki to pay an additional Rs 235 crore for enhanced land acquisition for its
Haryana plant expansion. The agency reminded Maruti that failure to pay the amount would lead
to further proceedings and vacating the enhanced land acquisition.[26]\

Industrial relations[edit]
Since its founding in 1983, Maruti Udyog Limited experienced problems with its labour force.
The Indian labour it hired readily accepted Japanese work culture and the modern manufacturing
process. In 1997, there was a change in ownership, and Maruti became predominantly
government controlled. Shortly thereafter, conflict between the United Front Government and
Suzuki started. Labour unrest started under management of Indian central government. In 2000, a
major industrial relations issue began and employees of Maruti went on an indefinite strike,
demanding among other things, major revisions to their wages, incentives and pensions.[27][28]
Employees used slowdown in October 2000, to press a revision to their incentive-linked pay. In
parallel, after elections and a new central government led by NDA alliance, India pursued a
disinvestments policy. Along with many other government owned companies, the new
administration proposed to sell part of its stake in Maruti Suzuki in a public offering. The
worker's union opposed this sell-off plan on the grounds that the company will lose a major
business advantage of being subsidised by the Government, and the union has better protection
while the company remains in control of the government.[27][29]
The standoff between the union and the management continued through 2001. The management
refused union demands citing increased competition and lower margins. The central government
prevailed and privatized Maruti in 2002. Suzuki became the majority owner of Maruti Udyog
Limited.[30][31]

Manesar violence[edit]
On 18 July 2012, Maruti's Manesar plant was hit by violence as workers at one of its auto
factories attacked supervisors and started a fire that killed a company official and injured 100
managers, including two Japanese expatriates. The violent mob also injured nine
policemen.[32][33] The company's General Manager of Human Resources had both arms and legs

broken by his attackers, unable to leave the building that was set ablaze, and was charred to
death. The incident is the worst-ever for Suzuki since the company began operations in India in
1983.[34]
Since April 2012, the Manesar union had demanded a three-fold increase in basic salary, a
monthly conveyance allowance of 10,000, a laundry allowance of 3,000, a gift with every
new car launch, and a house for every worker who wants one or cheaper home loans for those
who want to build their own houses.Initial reports claimed wage dispute and a union spokesman
alleged the incident may be caste-related.[35][36] According to the Maruti Suzuki Workers Union a
supervisor had abused and made discriminatory comments to a low-caste worker.[37] These
claims were denied by the company and the police.[33] The supervisor alleged was found to
belong to a tribal heritage and outside of Hindu caste system; further, the numerous workers
involved in violence were not affiliated with caste either. Maruti said the unrest began, not over
wage discussions, but after the workers' union demanded the reinstatement of a worker who had
been suspended for beating a supervisor.[34] The workers claim harsh working conditions and
extensive hiring of low-paid contract workers which are paid about $126 a month, about half the
minimum wage of permanent employees.[37] Maruti employees currently earn allowances in
addition to their base wage.[38] Company executives denied harsh conditions and claim they hired
entry-level workers on contracts and made them permanent as they gained experience. It was
also claimed that bouncers were deployed by the company.[35]
India Today claimed[39] that its interviews of witnesses present at the plant confirms the dispute
was over the suspended worker. The management insisted that they must wait for completion of
inquiry underway before they can take any action on the employee suspended for beating up his
supervisor. The management was then told, "you will be beaten up after we get a signal."
Thereafter, the workers broke up into groups, went on to set the shop floor as well as all offices
afire. They searched for management officials and proceeded with a beating of the officials at the
site with iron rods.
The police, in its First Information Report (FIR), claimed on 21 July that Manesar violence may
be the result of a planned violence by a section of workers and union leaders. The report claimed
the worker's action was recorded on close circuit cameras installed within the company premises.
The workers took several managers and high ranked management officials hostage. The
responsible Special Investigative Team official claimed, "some union leaders may be aware of
the facts, so they burnt down the main servers and more than 700 computers." The
recorded CCTV footage has been used to determine the sequence of events and people involved.
Per the FIR, police have arrested 91 people and are searching for 55 additional accused.[40][41]
Maruti Suzuki in its statement on the unrest,[42] announced that all work at the Manesar plant has
been suspended indefinitely. A Suzuki spokesman said Manesar violence won't affect the auto
maker's business plans for India.[34] The shut down of Manesar plant is leading to a loss of about
Rs 75 crore[43] per day.[44] On 21 July 2012, citing safety concerns, the company announced
a lockout under The Industrial Disputes Act, 1947 pending results of an inquiry the company has
requested of the Haryana government into the causes of the disorder. Under the provisions of
The Industrial Disputes Act for wages, the report claimed, employees are expected to be paid for
the duration of the lockout.[43] On 26 July 2012, Maruti announced employees would not be paid
for the period of lock-out in accordance with Indian labour laws. The company further
announced that it will stop using contract workers by March 2013. The report claimed the salary
difference between contract workers and permanent workers has been much smaller than initial

media reports - the contract worker at Maruti received about 11,500 per month, while a
permanent worker received about 12,500 a month at start, which increased in three years to
21,000-22,000 per month.[45] In a separate report, a contractor who was providing contract
employees to Maruti claimed the company gave its contract employees the best wage,
allowances and benefits package in the region.[46]
Shinzo Nakanishi, managing director and chief executive of Maruti Suzuki India, said this kind
of violence has never happened in Suzuki Motor Corp's entire global operations spread across
Hungary, Indonesia, Spain, Pakistan, Thailand, Malaysia, China and the Philippines. Mr.
Nakanishi went to each victim apologising for the miseries inflicted on them by fellow workers,
and in press interview requested the central and Haryana state governments to help stop such
ghastly violence by legislating decisive rules to restore corporate confidence amid emergence of
this new 'militant workforce' in Indian factories. He announced, "we are going to de-recognise
M
S
W
U
w
w h h
.
We will not compromise at all in such instances of barbaric, unprovoked violence." He also
announced Maruti plans to continue manufacturing in Manesar, that Gujarat was an expansion
opportunity and not an alternative to Manesar.[47][48]
Labour disputes are endemic in the auto industry of India and have affected other manufacturers.
India has strict labour laws, but their application is widely sidestepped by hiring low-wage
contract workers.[37] Manesar violence adds to India's recent incidents of labour disputes turning
to violence. Analysts claim[49][50] recent incidents like Manesar violence suggest a need for urgent
reform of archaic Indian labour laws, the rigid rules on hiring and layoffs, which harm the formal
sector and discourage investment in India. Government mandated procedures for labour dispute
resolution are currently very slow, with tens of thousands of cases pending for years. The
government of India is being asked to recognise that incidents such as Manesar violence indicate
a structural sickness which must be solved nationally.
The company dismissed 500 workers accused of causing the violence and re-opened the plant on
21 August, saying it would produce 150 vehicles on the first day, less than 10% of its capacity.
Analysts said that the shutdown was costing the company 1 billion rupees ($18 million) a day
and costing the company market share.
The previous week company officials had announced that Maruti would scrap the practice of
hiring contract workers and that the workers currently on temporary contracts would be made
permanent. It would begin the process of hiring new workers on a permanent basis from 2
September 2012.[51]
In July 2013, the workers went on hunger strike to protest the continuing jailing of their
colleagues and launched an online campaign to support their demands.[52]

Products and services[edit]

Current models[edit]
Model

Launched Category

Image

Omni

1984

Minivan

Gypsy

1985

SUV

Zen

1993

Hatchback

WagonR

1999

Hatchback

Swift

2005

Hatchback

Grand Vitara

2007

Mini SUV

Swift DZire

2008

Sedan

Ritz

2009

Hatchback

Eeco

2010

Minivan