The country's largest passenger vehicle manufacturer, Maruti Suzuki India Limited (MSIL) has realized that money generated from exports have been dwindling over the years. For this reason, the company plans to export vehicles to countries that have not witness much of motoring development. In areas like Africa, smaller fuel efficient vehicles would be popular and MSIL is considering selling vehicles in this region.
By setting up an assembly plant in Africa, MSIL is considering the revival of its export revenues, as the continent has hardly been explored for opportunities. As Europe is currently recovering from financial crisis, MSIL can thinking of doubling exports within the next four years if it sells in various emerging markets. Mayank Pareek, Head of Sales for MSIL, definitely feels that Africa is one such emerging market, where the first overseas plant can be set up.
Currently Algeria in northern Africa is a large market for MSIL, which is closely followed by Indonesia, Chile and Australia. Maruti models are also sold in South Africa, Morocco and Egypt. At present, Colombia and the Dominican Republic are being explored for sales opportunities. Indonesia and Thailand will not be looked at, since Suzuki already has its plants in those countries.
Commenting on the future, MSIL Chairman R.C. Bhargava said, "We will look at local assembly for two reasons. Firstly, there's usually a tax advantage. And second, there's pressure from governments in these countries to assemble models locally." Local assembling plants would definitely help in reducing overall costs for buyers and increase sales in the markets. Vehicles without airbags would sell greatly in African markets, which would help to push the sales of the Alto and Maruti 800.
