Maruti Suzuki, India’s leading carmaker, is taking steps to counter declining sales in the mini and compact car segment. Marking a significant move, the company has announced a price cut for three of its popular models – Alto K10, S-Presso, and Celerio – bringing them all under a special ‘Dream Series’ priced at INR 4.99 lakh for the month of June 2024. Previously, these models typically ranged from Rs 6 lakh to Rs 7 lakh. Maruti Suzuki is yet to update price list of the respective models on its website.
“We’ve observed good traction in the premium hatchback segment, and have been able to revitalise it,” said Partho Banerjee, Sales and Marketing Head at Maruti Suzuki India Limited. “The contribution of the premium hatchback segment reached 43% in May. In June, we want to focus on the small entry car segment. We’re launching a ‘Dream Series’ edition based on customer feedback, emphasising utility and value for money. This offer is valid for the month of June only.”
Maruti Suzuki has also implemented price reductions across its Auto Gear Shift (AGS) variants. This includes models like the Wagon-R, Swift, Dzire, Baleno, Fronx, and Ignis, alongside the aforementioned ‘Dream Series’ vehicles. The goal is to make automatic transmission options more accessible in the entry-level segment.
“We’ve also rationalised prices for automatic variants in the small entry car segment,” explained Mr. Banerjee. “We’ve seen that AGS penetration in NEXA models is around 20%, whereas it’s only 10% for ARENA models.” (NEXA and ARENA are separate sales channels within Maruti Suzuki.) With the revised prices, Maruti Suzuki aims to capture the potential with its Arena range of offerings.
This strategy reflects Maruti Suzuki’s efforts to revive the hatchback segment, which has witnessed declining sales in recent years. The rise of SUVs has been a major factor, with SUV sales recently surpassing the 50% mark. Entry-level hatchback sales have hit a historic low, falling from a peak of 4.5 lakh units seven years ago to just 1.6 lakh units in 2023-24.
Maruti Suzuki’s sales figures paint a similar picture. In May 2024, combined sales of the S-Presso, Baleno, Celerio, Ignis, and the new Swift totaled 78,108 units, compared to 83,655 units in May 2023. The company’s overall domestic sales for May 2024 reached 146,694 units, a marginal increase of 0.1% compared to May 2023 (146,596 units).
Looking at the broader industry, total vehicle sales in May 2024 reached 350,257 units, representing a 4.4% increase from May 2023 (335,436 units). Maruti Suzuki sold nearly 132,000 AGS models last year. “With this price rationalisation, we’re expecting AGS sales to grow by 15-20% this financial year,” said Mr. Banerjee. “Our aim is to encourage more entry-level customers to upgrade to automatic variants.”
Maruti Suzuki’s price cuts and special offers come at a time when the Indian car market is experiencing a shift in consumer preferences. By making entry-level hatchbacks and automatic transmissions more affordable, the company hopes to regain its footing in this crucial segment.