Good response to new Brezza and Grand Vitara can help Maruti regain its lost glory, wherein it commanded market share of more than 50%
Maruti Suzuki’s plans to boost its presence in SUV segment seems to be working, as the combo of Brezza and Grand Vitara have registered bookings worth an estimated Rs 25,000 crore. Total bookings of these two SUVs are in excess of 140,000 units.
While Vitara deliveries are yet to start, new Brezza has already raced to the top spot in sub-4 meter SUV segment. In August, Brezza was the top selling sub-4 meter SUV with sales of 15,193 units and market share of 24.09%. It was neck and neck with Tata Nexon, but comfortably ahead of Hyundai Venue and Kia Sonet. Around 45k units of new Brezza have already been delivered.
Most bookings for high-end variants
Another positive development from a business perspective is that most bookings for Brezza and Grand Vitara are for higher-end variants. Average selling price per unit has thus increased, which eventually means higher margins per vehicle sold. Brezza and Vitara are expected to significantly boost Maruti’s revenue and market share.
With more customers choosing top-spec variants of Brezza and Vitara, the combined average price is estimated to be around Rs 15 lakh per unit. A significant percentage of customers have booked the top-variant of Vitara. Bookings of Maruti’s new-generation SUVs is valued at around 25,000 crore, which is almost 1/4th of the company’s expected revenue in FY22-23.
If new Ertiga and XL6 are also added, total number of bookings comes out at around 2.40 lakh units. These are valued at around Rs 35,000 crore. Buoyed by good market response and increasing demand for SUVs, Maruti is planning to launch more such vehicles in the near future. This has been confirmed by Shashank Srivastava, senior executive director of sales and marketing at Maruti Suzuki.
With strong demand for Brezza and Grand Vitara, Maruti expects its SUV sales to double to around 3 lakh units per annum. Across its entire portfolio, average selling price of Maruti cars is now at Rs 7.10 lakh per unit. Earlier, it was Rs 6.10 lakh per unit. One reason is the rise in car prices, something that is applicable to the entire auto industry. Second reason is evolving preferences, wherein consumers are choosing pricier, higher-end variants that come with more features.
Maruti YTB SUV, 5-door Jimny incoming
Soon, Maruti will be expanding its portfolio to include YTB SUV (Baleno Cross) and 5-door Jimny. Both of these have been spotted on road tests in recent weeks. YTB SUV will be based on Baleno and could borrow some styling bits from Vitara. To ensure some level of exclusivity, YTB SUV could get a 1.0-litre turbo petrol motor. The SUV will be sold via Nexa showrooms.
With spectacular success of Mahindra Thar, Maruti is building a challenger in the form of 5-door Jimny. It is expected to reach production stage in 2023. As compared to 3,550 mm long 3-door Jimny that is manufactured in India for export markets, 5-door Jimny will be bigger. It is expected to get the 1.5-litre K15 petrol motor that makes 100 bhp and 136.8 Nm. This engine is already in use with Brezza, Ertiga and Ciaz.