Over the past few months, ever since Maruti Suzuki launched the their new cars like Baleno and Vitara Brezza, there has been a clear decline in sales of Maruti’s bread and butter, their twins Swift and DZire.
A new report now reveals that the reason behind this decline is not due to lower demand, but Maruti’s implementation of a new strategy. Maruti Suzuki is reducing production of Swift and DZire in order to manufacture their new models like Baleno and Vitara Brezza.
The reason being, there is more profit to be made by selling Baleno and Vitara Brezza as compared to that earned by selling Swift and DZire. On top of this, Maruti has to sell Swift and DZire with discounts and schemes in order to lure buyers as the segment sees competition from a lot of quarters – like Hyundai Grand i10, Hyundai Xcent, Honda Amaze, etc.
This is why Maruti Suzuki has systematically reduced production of Swift and DZire in the past few months, so that the production capacity can be used to manufacture more profitable Brezza and Baleno. This strategy will help Maruti Suzuki to post better profit figures at the end of current fiscal. This strategy is likely to continue till the introduction of new-gen Swift and DZire next year.
Speaking in numbers, Maruti Suzuki sold a total of 72,905 units of DZire in the period from Jan 2015 to April 2015. In the same period, they sold 74,381 units of Swift.
Now, during the same period in 2016, Dzire sales stood at 66,049 units while that of Swift declined to 59,717 units. This means, in 2015, DZire sales declined by 9.4% while Swift sales declined by 19.7%.
On the other hand, Maruti Baleno and Vitara Brezza sales have stabled at about 9,000 and 8,000 respectively a month on average.