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DIAGONSTIC STUDY
GROUP-09
With more than 50% of market share,
Maruti Suzuki should now focus on
increasing profitability through other
avenues.
ISSUE MAPS
Export
Sales Volume
Technological improvements
Revenue
Profitability Price
Expenses
Expenses as compared to Sales
(Rs. in Crores)
90,000 90.00%
80,000 80.00%
70,000 70.00%
60,000 60.00%
50,000 50.00%
40,000 40.00%
30,000 30.00%
20,000 20.00%
10,000 10.00%
0 0.00%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Sales (in Cr) Expenses (in Cr) Material Cost % Manufacturing Cost % Employee Cost %
BCG MATRIX
Revenues Distribution Profit margin% from Market share of each
Segment in each segment each segment segment
Mini 17% 20% 24%
Compact 46% 13% 42%
Mid-size 06% 08% 03%
Utility vehicles 22% 10% 28%
Vans 06% 22% 09%
LCV 01% 16% 01%
STARS MARUTI SUZUKI QUESTION MARKS
25.00%
UTILITY VEHICLES
20.00%
15.00%
MARKET GROWTH
10.00%
RATE
COMPACT VANS
5.00%
MINI MID-SIZE
CASH COWS
0.00% DOGS
20.00 2.00 0.20 0.02
RELATIVE MARKET SHARE
UNIT SALES OF PASSENGER VEHICLES
Unit Sales of Passenger Vehicles
Utility Vehicle as a segment grew by 29.6%
from 2016-2017
155,137
However, the entire market grew only by
21%
253759
Vans as a segment grew by 2.5% from
2016-2017 which is a meagre contributor
1,234,571 to overall sales.
Maruti Suzuki India Sales Channel till APRIL 2018 • Company's footprint has gone up from 800
PV for Commercial cities to 1643 cities
Use
10%
Traditional • 6% of the sales comes from the car aggregator
Commercial 56%
8% market which majorly targets the compact
segment offerings
True Value
7% • Nexa’s contribution to total sales volume
Nexa has further increased from 15% in FY17 to
15% 19.9% in FY18
Traditional Turned
Arena
4%
Traditional Traditional Turned Arena Nexa
True Value Commercial PV for Commercial Use
MID-SIZE SEGMENT CAR CIAZ SALES HAS DECLINED BY ~ 8% Y-O-Y IN FY 18 THEREFORE LOOK AT REVAMPING
ITSELF TO REDUCE THE INVENTORY PILING UP IN THE COUNTRY DUE TO OVERALL LOW SALES CONTRIBUTION
200000 80%
180000 70% average nearly 27,000 -
160000 28,000 cars every month,
60%
of which nearly 15,000 -
Domestic Market
140000
120000 50% 16,000 were Balenos,
100000 40% followed by Ignis, Ciaz, and
80000 S-Cross.
30%
60000
20%
40000 • Nexa’s S-cross is not
20000 10% contributing in the utility
0 0% vehicle segment.
Premium Hatchback Utility Vehicle S-
Mid Size Ciaz
Baleno and Ignis Cross
Units
Series1 186000 49094 35557
Series2
In % 69% 18% 13%
INCREASE EXPORTS & GO INTERNATIONAL
GDP vs Passenger automobile growth rate Y-o-Y (2017)
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
Brazil Iran Philippines Thailand Chile Indonesia
GDP Growth 1% 4.30% 6.70% 3.90% 1.50% 5.10%
Passenger Automobile Growth rate 9% 10.80% 10.20% 14.10% 18.00% 6.82%
GDP Growth Passenger Automobile Growth rate
RECOMMENDATIONS & SHORTFALLS
The countries stated have high potential for We have only identified potential markets to
exports and the passengers car segment is boost exports
growth rapidly.
We are yet to consider specific country's
Though relatively small countries, having a Purchasing Power, Tax structure, Political
greater market share can act as a stepping uncertainties, currency volatility and Individual
stone to have a significant market in car segments
developed nations like USA, Europe - Britain,
France.
In the existing markets, Maruti Suzuki is not Competitiveness of MSI each country
even in top 4 in terms of market share. wrt price. (Excel)
Increasing their share by revamping certain
models like Swift, Baleno, Ciaz can work
1.5 BILLION INVESTED IN R&D, MARUTI PLANS TO SELL OVER 200,000
CARS WITH AGS & TELEMATIC TECHNOLOGY