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Business News/ Companies / Maruti’s market share lowest in 10 years
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Maruti’s market share lowest in 10 years

Maruti’s market share lowest in 10 years

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New Delhi: MarutiSuzuki India Ltd’s share in the country’s passenger vehicle market slipped to nearly 40%, its lowest in a decade, mainly because of labour unrest at a plant and the entry of rivals in the small-car segment.

India’s largest car maker sold 40.3% of the 977,201 passengers vehicles sold nationwide until August this fiscal, compared with 44.9% a year earlier, according to industry lobby Society of Indian Automobile Manufacturers (Siam). In 2000, the company’s passenger vehicle market share was 55.5%.

Also See | The Drop (PDF)

The main gainers this fiscal are Toyota Motor Corp., which has increased market share from 3.3% to 5.6%, and Volkswagen AG, which has risen to 3.2% from 1.2%.

Maruti’s share could shrink further. Its sales in September were down 17.2% from a year earlier to 78,816 units following a month-and-a-half-long stand-off between workers and the management at its plant in Manesar, Haryana. This followed an earlier stir in April.

“The recent strikes must have impacted our market share as we were not producing what we should have, but we are ramping up production to meet the demand ahead of the festive season," said R. Dayal, Maruti Suzuki’s executive director, production and engineering. “We will have to increase our production to make up for the shortfall in sales."

Dayal said the company is shifting the production of the Swift model back to the Manesar plant after workers and the management reached an agreement.

“The production of Swift will be ramped up 20,000 units in order to reduce the waiting period for the car," he said. “We are confident that will be able to regain our lost market share."

The new version of the Swift has crossed 100,000 bookings since its launch on 17 August. Buyers face a waiting period of six-eight months.

The production of the A-Star and SX4 models will also return to Manesar, Dayal said.

While labour unrest may have led to production losses and caused Maruti’s market share to shrink, the company’s dominance will remain under threat from new rivals in the small-car segment.

“Toyota seems to be a major gainer with its Etios and Liva (models) generating good response," said Yaresh Kothari, an analyst with Angel Broking Ltd. “The competition from General Motors, Ford and Volkswagen is also increasing."

amrit.r@livemint.com

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Published: 04 Oct 2011, 01:05 AM IST
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