Maruti Suzuki - History and Success in India [Case Study]

Manav Makhija Manav Makhija
Mar 8, 2021 6 min read
Maruti Suzuki - History and Success in India [Case Study]

The Indian automobile industry is one of the most competitive sectors in the economy. There are approximately 5000 car dealers in India wherein approximately around 11 – 12 cars are being sold every minute. Be it SUV or sedan, as the standard of living is rising in India, people feel like having a car is a necessity.

In the past decade, the popularity of having cars has increased a lot. Due to the advancement in technology, cars have become affordable as well as eco-friendly. With the increasing needs of people in India, the competition in the automobile industry is beyond par.  Even when there are many automobile companies in India who sell affordable, luxury all kinds of cars, there is one company that has always been on the top priority of people and that is Maruti Suzuki.

In this Maruti Suzuki Case Study, you will know all about the History and Success of Maruti Suzuki in India.

How Maruti Suzuki Started in India - History
How Maruti Suzuki Became Successful
FAQ

Maruti Suzuki in India - History

Maruti Suzuki launched their first car in India Maruti 800 became the choice of every Indian household. It was affordable back then in those days and became incredibly popular and is considered to be the Maruti classic to date. Although the journey of Maruti Suzuki India Ltd. started off in a very different way.

Maruti Suzuki - 1980

In India, till the early 1980s the Indian government controlled the Indian automobile sector, and privatization did not enter yet. There were only two automobile companies – Premier Automobiles Ltd. which had their popular car named Premier Padmini and Hindustan Motors Ltd. who made Ambassador cars.

Premier Padmini Maruti case study
Premier Padmini

Maruti Suzuki - 1983

It was 1983 when the entire Indian automobile market changed because and the licensing policies changed and moreover Maruti Udyog Ltd. entered the space. They started producing their cars in the year 1983 with an aim to modernize and mobilize the automobile industry.

Our country was in need of producing fuel-efficient vehicles to meet the increasing demands as the local transport was inefficient and there was a growth in the purchasing power of Indians.

To cater to these needs, the Indian government initiated a joint venture with Suzuki Motor Corporation, Japan who was then experts in manufacturing and selling cars across the globe.

On Oct, 1983 the joint venture was signed between the two companies where Suzuki agreed to have a 26% stake in equity along with providing the latest technologies that they had and the Japanese management techniques and practices. In the later years, their equity was raised to 40% in the year 1987 and 50% in the year 1992.


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Maruti Suzuki - 2002

In 2002, the Indian government gave the charge of the management of Maruti Udyog Ltd. to Suzuki for a consideration of Rs1000 crore. In the later years, the government sold 27.5% of the stakes to the public to collect money and the stakes of Suzuki increased to 54.2% in Maruti Udyog Ltd.

Maruti Suzuki - 2007

On May 10, 2007, The government of India decided to sell the entire share to the Indian Financial Institutions and since then the government does not have any stake in Maruti Udyog Ltd. In July 2007, Suzuki decided to change the name of its subsidiary to Maruti Suzuki India Limited.

Maruti Suzuki Logo Maruti case study
Maruti Suzuki Logo

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How Maruti Suzuki Became Successful

5 Main things that made Maruti Suzuki a great success - Affordability, Goodwill, Hatchbacks, Low Maintenance & NEXA

Affordability

In the early ’80s cars weren’t something that every Indian man or a middle-class family could afford. It was a luxury resource about which only a few people could dream. There weren’t many car companies since liberalization came late in India.

When Maruti Suzuki entered the Indian market, the most prominent factor which made it the market leader at that time was the price of its cars. They were very successful in launching cars with excellent features at an Indian budget-friendly price which made it ‘people’s car’.

Even to date company’s cars are known to be in a range which any middle-class man today can afford to buy.

Goodwill

Over a decade ago, Maruti Suzuki launched an advertisement video which said ‘Ghar aa Gaya Hindustan’ which became an instant sensation among people of India. Since the initial years, Maruti Suzuki has been successful in creating a notion into the minds of people that they associate home, the nation with their car.

Their commercial still instills that India comes home in a Maruti Suzuki. The company has received great acceptance for the brand and its customers are very loyal to them. All these years, customer satisfaction has proved that Maruti Suzuki’s goodwill and brand loyalty are very strong and enthralling.


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Hatchbacks

Hatchbacks are the most idol cars for Indian roads and they rule the market. They are everywhere present in the market and are the most preferred body type throughout the nation. Maruti Suzuki initiated the concept in India and its most popular hatchback car Alto is one is the most demanded cars in India to date.

Maruti alto
Maruti Suzuki Alto

Low maintenance

When comparing the services of different automobile companies in India, Maruti Suzuki’s service charges are lower. The best thing about their services is that they have various stations and centers across the nation where they serve a huge number of cars daily. Today they make most parts in India under the Made in India and hence their spare parts and components are variably low when compared to other automobile companies.


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NEXA

Since Maruti Suzuki’s cars were always looked at as the mid-range cars that serve the middle-class category they wanted to enter the other market too. That is when Maruti Suzuki launched NEXA. In 2015 they started the delivery and operations of its premium range cars. This helped them engage with their high-end customer category.

Maruti Suzuki Nexa
Maruti Suzuki Nexa

Conclusion

The automobile sector has been growing rapidly over the past decade, even after the Covid-19 pandemic. Maruti Suzuki cars have emerged as budget-friendly and low-cost cars with superior after-sales services that have made it India’s top choice for many car owners.

Maruti Suzuki will play a very important role in making cars assessable and available to many Indians in the future as well. Its aggressive management and promotion strategies will cater to huge demand in the Indian automobile market.

FAQ

What is the net worth of Maruti Suzuki?

As of 2020 the total assets of Maruti Suzuki is ₹63,627 crore (US$8.9 billion).

Who is the chairman of Maruti Suzuki?

Shri Ravindra Chandra Bhargava is the chairman of Maruti Suzuki.

Is Maruti a Govt company?

Maruti was a Govt company, but in 2002, the Indian government gave the charge of the management of Maruti Udyog Ltd. to Suzuki for a consideration of Rs1000 crore.

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