WHEELS ON THE BUZZ

Undeterred by the slowdown, carmakers have big plans for the future, and they are not necessarily electric.

- MAIJO ABRAHAM & NACHIKET KELKAR

Kenichi Ayukawa is still in awe of the diversity of India, his home for the past seven years. And that is exactly why he wanted the local research and development team of the company he runs, India’s largest carmaker Maruti Suzuki, to excel. It was well-placed trust, as the first model Suzuki designed and developed in India, the Vitara Brezza, has been a runaway success.

When Ayukawa took charge of Maruti Suzuki India in 2013, the carmaker was having a bumpy ride in the aftermath of a labour crisis at its Manesar plant and also because of the diminishing demand for petrol vehicles. Its market share had dropped below 40 per cent and it seemed clueless about how to deal with the changing customer preferences. Ayukawa had come with a plan. Under him, Maruti moved from its bread-and-butter small car portfolio to more premium products. When he came up with Nexa, a premium network of dealership for the premium cars in the Maruti stable, many industry experts questioned the rationale behind the move. Nexa, however, turned out to be a masterstroke, as it became the first choice for Maruti customers who wanted to upgrade.

In five years, Maruti regained lost ground, once again crossing 50 per cent market share thanks to the success of models like the Baleno and the Brezza. Bigger cars now contribute more than a quarter of the company’s revenues. And the India unit is the Japanese parent’s biggest contributor to volumes and profit.

Ayukawa, however, now has a new set of challenges before him, and it goes beyond launching new models. As cars are becoming more and more technologically advanced, he has been trying to figure out how to control the cost of bringing in these technologies. “What is crucial is to balance cost and technology,” he said. That is pretty important for Maruti, as pricing remains the single largest factor that gives Maruti cars the edge over the rivals.