The Success of Maruti Suzuki in

Indian Automobile Market

Section B Group - 9
Arun Antony – 1810060
Ajinkya Joshi - 1810076
Rohit Malhotra - 1810095
Sahini Sai Kruthi - 1810097
Tushar Saran - 1810106
Introduction
 Maruti Suzuki India Limited is a leading automobile manufacturer in India.

 Incorporated in 1981

 Formerly known as Maruti Udyog Limited (MUL)

 Subsidiary of the Japanese manufacturer Suzuki Motor Corporation.

Reasons for Suzuki’s success
Monopolistic Market

Oligopolistic Market

Economies of Scale

Cannibalization

Large Network

Pre-owned Car sale

Tax Reduction

0 Segmented Product portfolio

Monopolistic Market
 Automobile industry in India was monopolistic when Suzuki entered

the market.

 Pet project by Sanjay Gandhi

 Huge entry barrier to the market due to Government regulations.

 Maruti Suzuki Ltd. had enough time to establish their dominance.

Oligopolistic Market
 Indian Government liberalized foreign investment in 1981.

 Faced other foreign competitors for market share

 Maruti Suzuki has a cost-efficient production model

 Maruti Suzuki had the First Mover’s Advantage

Economies of Scale
 Started by importing cars and various elements from its parent company

 Started indigenous manufacture of parts and reduced imports.

 Increased production volume gives Maruti Suzuki enhanced economies

of scale.

 Cost of production decreased with increase in number of units produced

Cannibalization
 New models of Maruti Suzuki cannibalizes its other models.
 Customer may buy Alto instead of a Wagon-R or Wagon-R instead of Swift
or Swift instead of Baleno.

 Either way, the sales remain with Maruti Suzuki.

 Offered diverse model range in terms of fuel used also.

 Products also made their own brand in the customer’s mind

Large Network
 Very strong and large dealership network.
 Has large number of listed authorized service centers and express service
stations.

 Service also attribute to a major revenue share of the company

 Kept a high benchmark for the Competitors.

Pre-owned Car sale
 Maruti Suzuki was the first in India to launch pre-owned car sale.

 Launched under the banner of ‘True-Value’ in 2001.

 Increased the resale value of Maruti Suzuki models.

 Added advantage for Maruti Suzuki models over competitors

Tax Reduction
 Had clever strategy to go around Indian tax laws.

 Only cars of length >4m was affected by tax.

 All cars made by Maruti Suzuki was <4m in length.

 High Import tax caused high price for foreign competitor’s cars.
Segmented Product portfolio
laws.
Thank you