Maruti Suzuki Aims NEXA Sub-Brand To Outnumber Tata Motors, Hyundai Sales By 2024
Maruti Suzuki's Nexa chain accounts for about 23 percent of the company's overall sales this year and has grown around 47 percent while achieving cumulative sales of 2 million units.
Maruti Suzuki India recently announced that the Nexa outlet of the company achieved cumulative sales of 2 million units in India Following that, Senior Executive Officer, Marketing and Sales, Shashank Srivastava, of the company stated that Maruti Suzuki India plans to outsell Hyundai and Tata Motors in terms of overall sales by the end of the next year through the selling of premium vehicles through Nexa retail locations.
The Nexa retail chain, started in 2015 to sell Maruti Suzuki's premium vehicles, has crossed the cumulative sales milestone of 20 lakh units. It currently sells models such as Baleno, Ignis, Ciaz, XL6, and Grand Vitara. Upcoming SUVs Fronx and Jimny will also be sold through the chain.
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The company, which has decided to increase the prices of its vehicles from April, feels the hat response of consumers to the increase in vehicle prices by auto manufacturers to meet regulatory requirements needs to be watched out for, although it expects passenger vehicle sales to grow between 5 percent and 7.5 percent in FY24.
"We have completed the two million mark for the Nexa. The first million came in four years, the next million has come in three years, despite the fact that we have had in the last three years, a little bit of a disturbance in the business environment because of the COVID-19," Srivastava told reporters in a virtual interaction.
He further said, "We are hopeful that next year, Nexa which is currently number four in the industry, we hope to make it the second largest brand in the auto industry next year."
Maruti Suzuki sells its mass market models through the Arena chain while Nexa retails its premium models.
Nexa chain accounts for about 23 percent of the company's overall sales this year and has grown around 47 percent. On a standalone basis Nexa has a market share in excess of 10 percent overall in the domestic passenger vehicles industry, Srivastava added.
"We expect (Nexa) to close this (fiscal) year at around 3.7 lakh units against 2.55 lakh units that we did last year...We hope to sell larger numbers next year with the Fronx, the Jimny (coming in), and the full-year effect of the Grand Vitara. Next year, thanks to these new models, we are expecting the sales to be even higher, maybe close to six lakh units," he said. At present, he said, Nexa's sales volume is fourth behind Maruti Suzuki's Arena, Hyundai, and Tata Motors.
In the April-February, period this fiscal, Maruti Suzuki's total domestic passenger vehicles (PV) sales stood at 14,74,107 units as compared to 11,97,697 units in the year-ago period.
On the overall PV industry sales growth prospects, Srivastava said, "The industry growth is expected to be somewhere in the 5 percent to 7.5 percent range. This year, it is expected that the industry sales will close at around 3.89 million, that's a growth of almost 26 percent over last year's 3.07 million. So on this base of 3.89 million, we expect actually the volumes next year in the industry to be between 4.05 million to 4.1 million units."
However, the growth would depend a lot on the country's economic growth, monsoon pattern and its impact on the rural market, increase in interest rates, liquidity levels, and the impact of price hikes undertaken by automobile manufacturers to meet regulatory requirements on demand, he said.
"There are red flags which we are watching at the moment, though in balance it appears that the growth would be about 5 to 7.5 percent," he said, adding as for Maruti Suzuki "we would expect our growth to be higher than the industry".
With PTI Inputs