Car consumption in India will continue to accelerate: Shashank Srivastava

At the second edition of ABP’s Ideas of India summit 2023, Shashank Srivastava, senior executive officer (marketing and sales), Maruti Suzuki India, communicated how the automobile brand views competition, its growth revenues, the decline of the SUV market share and more. The moderator for the session was journalist Shankar Aiyar.

 

Expansion of Maruti Sukuzi’s footprint

 

Srivastava shared that being present in the Indian market for over 40 years helped them generate revenues for the country as well as the brand. He expressed, “Since we launched in India, to date, we have sold 2.5 crore vehicles. In addition to our scale in revenues, we have about 3,500 showrooms and about 4,000 plus workshops, and we cover 3,000 markets. We also have a presence in villages, and Maruti Suzuki has been able to sell its vehicles in 4.5 lakh villages in India.”

 

Talking about its growth numbers, Srivastava stated, “In 2022, India covered around 60% of the overall Suzuki Motor Corporation globally. It showcases the upswing in the Indian economy.” 

 

Srivastava pointed out that the Indian market is a very young market with over 65% less than 35 years. 

 

“The Japanese market is an ageing society compared to India, a youth-driven market. Hence, in terms of consumption, we expect that car consumption in India will continue to accelerate. Our projections are bullish and predict that the consumption for the Indian market will reach 6 million by 2030 from the current level of about 3.8 million in 2022”, he said. 

 

Maruti Suzuki on Make in India

 

According to Srivastava, the exportation has led to an acceleration in localisation.

 

He shared, “This financial year we expect to export around 2.5 lakh vehicles. This is an important contribution to our brand because when we started 40 years back India had no component manufacturer. After the partnership with Suzuki the technology that was brought in helped us develop a vendor base and boost localisation. This has helped with efficiency and has also brought our manufacturing costs down.”

 

Competition 

 

For Srivastava, when there is new competition in the market, it helps brands such as Maruti Suzuki.

 

“Competition always helps brands. Not only to win consumers but also helps us evolve and be better. We need to improve continuously and competition leads to this desire to change. Our goal is to be value driven with new launches and our brand identity," he commented. 

 

Srivastava remarked that SUVs are the biggest segment in the Indian auto market with over 45% market share. He also pointed out that hatchbacks too have seen a decline in demand and have only around 35% market share. 

 

Talking about Maruti Suzuki’s market share in regards to SUVs, he shared, “The biggest strength Maruti Suzuki has is its small car segment with over 70% plus market share and in the vans segment, we are 90% plus. We aim to strengthen our SUV space. If we try to achieve around 35% of the SUV segment for Maruti then we can target at least 50% of the overall automobile market share.”

 

EVs

 

Srivastava felt that there seems to be a consensus in the industry, that going forward, EVs will become mainstream. 

 

However, he feels that the cost of acquisition is creating a roadblock in the growth of EVs in India.  

 

Explaining this challenge further, he said, “If the cost of a normal car is 100, then EV is 160 due to its high cost of batteries. Maruti Suzuki is trying to bring down battery costs. We will have six EVs in different segments by 2030. Our estimate is this market which is 1% today, will be around 3% in 2024-25. We believe that by 2030, we will see one million EVs.” 

 

Infrastructure will also be paramount in the growth of EVs in India, remarked Srivastava. 

 

Signing off, Srivastava spoke about the potency of charging stations in the maturation of the EV market. He concluded, “For every 10 EVs, we will need to have one charging station implemented. We predict that four million EVs will be sold, hence there should be around 4,00,000 charging stations implemented. This is a challenge at this point.”