Maruti Suzuki Ciaz helps shed low-cost car seller image

Wednesday 25 March 2015, 15:24 PM by

For a long time now, Maruti Suzuki has been the undisputed top brand in the passenger car segment of the Indian automobile market. Hyundai Motor India, however, at times has challenged its supremacy and Maruti Suzuki has warded off competition with relative ease. Unfortunately, catering to a mass customer base in India automatically comes with a negative cost. In Maruti Suzuki’s case, it is the fact that they have been labelled as low-cost car sellers, which cater to only lower-middle income groups. The firm tried to change it in the recent past but was not able to do so. However, the launch of Maruti Suzuki Ciaz has altered this thinking and things might be changing for India’s most successful car manufacturer.

Maruti Suzuki Ciaz is a stylish vehicle that was launched in competition with the likes of Honda City and Hyundai Verna. Though it has not been able to deliver to the level of its competitors, Ciaz surely has helped change the perception about Maruti Suzuki. The car has done exceptionally well in the market given its price range and achieved something unprecedented in the firm’s history.

Maruti Suzuki Ciaz helps shed low-cost car seller image |
Maruti Suzuki Ciaz

According to a report by brokerage house CSLA, if Maruti Suzuki can continue with this strategy, it might finally be able to break away from its image of being a producer of low-cost cars. "Over the years, Maruti has steadily expanded its footprint from entry small cars to premium small cars to entry sedans and now to large sedans. This is crucial as the Indian passenger vehicle (PV) market is steadily moving away from small cars towards sedans/SUVs. Improving acceptability of Maruti's brand in higher price-point segments significantly improves its long-term risk profile and warrants a higher valuation multiple for the stock," the report stated.

A relevant precedent is already present in the market from which Maruti Suzuki can take inspiration. Till a couple of years back, Japanese car maker Honda was seen as a caterer to only the elite and the lack of a diesel model was hurting the firm a lot. However, Honda took the challenge on and launched the Amaze compact sedan, which achieved superb success in the Indian market. In fact, the Amaze dethroned Maruti Suzuki Swift DZire in its segment and opened the door for other brands to enter. Experts believe if Honda can achieve such a feat in a foreign market like India, Maruti Suzuki has everything it takes to become a brand that caters to the elite.

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