Maruti says no to luxury cars

New Delhi, Aug. 23: With Maruti Suzuki commanding 52.54 per cent market share of mass passenger vehicles, some of its shareholders want the company to think bigger and enter the luxury segment, but it is happy to concentrate on its strength.

During the 37th Annual General Meeting of the company held here on Thursday, one of the shareholders pointed out to the management that it was time for Maruti Suzuki to consider competing with the likes of Mercedes- Benz, BMW and Audi.

The logic behind the suggestion was that Maruti already has over 50 per cent market share in the mass segment and it was time to move up the value chain.

Responding to the suggestion, Maruti chairman R. C. Bhargava said the company’s effort would be to provide features that are found in luxury cars in the company’s affordable products.

“Today we have the new Ciaz, which has a lot of the features that you find in the ‘ premium sector’ cars and at a much lower cost,” he said.

Mr Bhargava further said, “Please remember that India is a country where people are very very price sensitive ( and) affordability is a factor.”

He also said that selling high- priced and small volume products did not fit into the firm’s strategy.

“Maruti's strength is bulk manufacturing in large scale, Mr Bhargava said, adding, “and small volume sales, what some of the premium manufacturers do, just does not fit into our business model”.

He said, however, it doesn’t mean that the company’s customers would be deprived of the premium features.

“We will keep improving our cars and we will keep improving what value we give to our customer but this decision of what cars should we make, I request you to kindly let the board decide,” Bhargava said.

— R. C. BHARGAVA Maruti’s strength is bulk manufacturing in large scale and small volume sales, what some of the premium manufacturers do, just does not fit into our business model.