India’s largest carmaker Maruti Suzuki on Friday said that there’s a shift in customer preference due to which the hatchback segment has been seeing constant degrowth in the last 3-4 years. “While the auto industry will see a growth of a few percentage points above the peak in 2018, the hatchback segment will continue to de-grow even in the next year,” Maruti’s chairman RC Bhargava told reporters at the post-Q2 results press conference.
In 2018, passenger car sales stood at 2.24 million units and this year car sales are expected to cross that figure. “It’s after a long time auto industry will find a growth path but the auto industry has lost four years. There’s been very slow growth in last four years,” he adds.
“In Q2, the hatchback segment has shown a growth but that’s limited to the festive growth which means the ability of the people to buy hatchbacks has eroded.”
He adds that next year, the overall growth of the industry will be 8 per cent. “Small car decline came well before inflation. Around 26 per cent volume has gone down in 3 years. Inflation will only make it worse,” he said.
Maruti Suzuki India on Friday reported 334 per cent year-on-year (YoY) growth in its standalone net profit for the quarter that ended September FY23 (Q2FY23). Its standalone profit increased to Rs 2,061.5 crore for the quarter, up from Rs 475.3 crore logged in the same period last year. Higher commodity prices and chip shortage concerns had impacted earnings in the year-ago period, the company said. Its standalone revenue from operations surged 46 per cent YoY to Rs 29,931 crore and it sold a total of 5.17 lakh vehicles during the quarter that ended September FY23, the highest ever in any quarter, increasing 36 per cent YoY, which comprises domestic sales of 4.54 lakh units and exports at 63,195 units.
Bhargava said that the company has not given up its challenge of 2 million sales this fiscal. “There’s a constraint of semiconductor from one company that’s affecting four models. If we get the supplies, we’ll be able to achieve it,” he adds.
“You’re seeing some kind of a change in composition of sales because of various price increases accentuated by inflation but the results is going to be composition of vehicles sold in the market will change. Upper-end of the market ill wee more sales,” said the Chairman.
According to Bhargava, India is moving away from the market which was predominantly a small car market. “We recently launch SUVs like Brezza Grand Vitara. There are more developments in the SUV segment. We as a car manufacturer have to follow our customers. It’s not that we’re going out of the small car segment,” he said.
He adds that small cars, which comprised around 75 per cent of the market might drop to 60-65 per cent.
