As the race for second place intensifies between Tata Motors and Hyundai, Maruti Suzuki, the country's largest carmaker, is also vying for the same spot, albeit with its premium Nexa brand. It hopes to nudge ahead of the other two in FY24 (April 2023-March 2024).
- Hopes to sell over 6 lakh cars annually from Nexa
- Maruti has 449 Nexa showrooms in 287 cities
Maruti’s goal for Nexa
With the addition of new models like the Fronx, Jimny, and the upcoming Innova Hycross alternative, along with full-year sales of the Grand Vitara midsize SUV, Maruti Suzuki expects Nexa volumes to grow between 65-70 percent in the next financial year. This is yet another aggressive target set by the carmaker, having already announced its plans of grabbing SUV leadership from Tata Motors in FY24 and regaining 50 percent share by FY25.
At present, Hyundai Motor India is the second-largest car brand in the country with sales of 5.16 lakh units followed by Tata Motors, which has retailed about 4.93 lakh units. On average, Maruti Suzuki sells 30,000 units every month from its premium Nexa channel, which is around 3.6 lakh units annually, so the gap is quite substantial. Maruti also hopes to breach the half million sales mark with over 6 lakh retails, say people in the know.
Maruti Suzuki has about 449 Nexa showrooms in 287 cities, and the Nexa brand currently has a market share of about 10 percent.
“The target will be a stretch, but it is a good target to take,” said Shashank Srivastava, senior executive director, sales and marketing at Maruti Suzuki to our sister publication Autocar Professional. “It is not with arrogance we are saying this, but it is a good objective for us to galvanise our entire team, supply chain, production, sales and marketing to move towards this target of number 2. We understand that it is going to be difficult, but we believe we can make a strong attempt at it.”
Composition of Nexa buyers
About 25 percent of Nexa buyers are replacement car buyers, while 40 percent are additional car buyers. Nexa car buyers are relatively more affluent than traditional mass market buyers from the Arena Channel. The monthly household income of car buyers at Nexa is about Rs 94,000 versus Rs 69,000 of an Arena buyer, Maruti Suzuki shared.
Srivastava says for cars sold under the Nexa brand, the win back percentage or prospective buyers owning a non-Maruti is a fairly high 35 percent. This essentially means that the company is able to get a sizable share of non-Maruti owners to upgrade to a Maruti.
“While the perception may be that we are leaders only in sub-Rs 10 lakh space, we are also leaders in Rs 10 lakh-15 lakh space with 26 percent market share. We are confident that we will be able to do well even in Rs 15 lakh space – led by our experience and our infrastructure. We have enough products now, and with Fronx and Jimny, we should be able to get much higher volumes next year,” Srivastava added.
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