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Informist, Friday, Aug. 1, 2025

By Anand JC

NEW DELHI - Maruti Suzuki India Ltd. expressed confidence that the upcoming Onam festival will kickstart a positive festival season for the company, wherein it would see green shoots emerging amid a subdued demand environment for passenger vehicles. "We are hopeful that if Onam goes well, then Ganesh (Chaturthi, in September) and then later on Navratra, and fundamentally the monsoon is good... I am sure there is no reason why this festival should not be good," Maruti Suzuki's Executive Director Partho Banerjee said at a virtual press conference on Friday.

Maruti Suzuki's automobile despatches contracted 3% on year to 180,526 units in July. Wholesale sales in the industry as a whole grew around 1% in July, Banerjee said. However, at the retail end, bookings at Maruti Suzuki's dealerships went up 7% on a pan-India level. "So, what we are seeing now is that in the booking, there is almost a growth of 10% in the Kerala market, which is a very good sign actually," Banerjee said.

To boost the demand for smaller cars, Maruti Suzuki launched six new limited-edition variants across eight models in July, including the WagonR. "What we are seeing is that the WagonR has started revolving back. And the numbers of the WagonR have started moving up, that's a very positive sign," Banerjee said. The company expects these limited edition variants to spur demand for its vehicles, especially in the small car segment, which was marred by affordability issues in recent years.

Growth in rural areas, which has been outpacing urban areas in multiple sectors, saw some slowdown in July. Maruti Suzuki's growth in rural areas was 10% last year, which moderated to 2-3% in July.

Maruti Suzuki has also been calibrating its shipments to dealerships, which is reflected in lower wholesale sales. "We don't want to increase the network stock at our dealer end," he said. "We always calibrate our supplies to our dealer if we see that network stock is not going to increase at all. So fundamentally, we have calibrated our dispatches in the month of May and June to ensure that the network stock doesn't increase," he added.

Maruti Suzuki has now introduced six airbags in nearly 98% of all its cars sold, for which it has hiked prices to pass on the costs. While customers have been enquiring about the company's cars, dealerships have had a difficult time converting their interest due to increased car prices. This stress has been seen more in the entry-level cars, Banerjee said. 

"Booking also there (compared to earlier) is an improvement. But somehow, the conversion from booking to retail is not happening as compared to the higher segment models, in which the booking to retail is pretty okay," he added. In essence, the down payment amounts for loans are currently too high for customers in this segment, especially after the introduction of six airbags, which Banerjee termed a "Catch 22" situation. The company is working on the issue with non-banking financial corporations to bridge the gap, he said.

The company's compressed natural gas-run cars have emerged as a bright spot in recent months. "We are seeing a robust growth of almost 11% for the year, starting from April to July. So CNG has been one of the game-changers from the stable of Maruti," Banerjee said. Penetration of CNG cars in its entire portfolio is around 40%, as of Jul. 31. 

However, the segment is facing capacity constraints. "We are working it out to further increase the supply of the CNG vehicles, not only in Dzire, but other models also. Keeping in mind the festival season is coming, we are going to increase the supply of CNG vehicles," Banerjee said. Retail sales of CNG-run cars grew 16% in July to 52,000 units. 

The Maruti Suzuki Dzire was the company's top-selling model in July. "You would recall that we launched this model in the month of November. Still now, we are having back orders, which is a very good sign in this tough market also," Banerjee said. Given the high acceptance for the model, the company is selling around 20,000 Dzires per month. 

Despite the ongoing issues surrounding the import of rare earth magnets from China, Banerjee said that the company will begin sales of its first electric car, the e Vitara, in 2025-25 (Apr-Mar), as per its original plans. 

Maruti Suzuki reported a net profit of INR 37.1 billion for the June quarter on a revenue of INR 384.1 billion. Friday, its shares closed 2.4% lower on the National Stock Exchange at INR 12,302.

End

Edited by Saji George Titus

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