A passage to India: Why Suzuki chose to unveil the e Vitara, its first EV, in Europe

Suzuki had a good reason to display its first mass-production battery electric vehicle (BEV) in Europe. According to people in the know, the company views the e Vitara as an excellent export prospect, particularly in markets with a more evolved EV ecosystem and charging infrastructure.

And so, the carmaker is believed to be looking at commencing shipments of the electric sports utility vehicle (SUV) to Europe first. This will be followed by launches in Japan and India during the course of this year.

In all, there are about 100 countries on the company’s export radar. Almost 50% of the BEV production is expected to gun for the export markets after specific customisations for each region. Best of all, as far as India is concerned, the SUV will be made by Suzuki Motor Gujarat (SMG). The cost-efficient production capabilities in India will help Suzuki price the e Vitara competitively in overseas markets.

“We have chosen India as the global manufacturing base due to its quality products, and scale merit," said Toshihiro Suzuki, representative director and president of Suzuki Motor Corporation, while speaking at the Bharat Mobility Global Expo 2025 in January.

The Japanese company has invested about ₹2,100 crore to produce the e Vitara in Gujarat. SMG has been operational since 2017 and has an annual production capacity of 0.75 million units. With the completion of a fourth production line in 2026-27, its annual production capacity will increase to 1 million units. Production of the e Vitara will commence shortly, according to the company’s management.

Round tripping

Auto industry watchers say Suzuki’s decision to launch in Europe first is very deliberate. “By focusing on key markets in Japan and Europe, the automaker aims to gain a foothold in areas with substantial demand for EVs. This strategy enables Maruti Suzuki to cultivate brand recognition and compete with global contenders, particularly Chinese firms recognized for their cost-effective electric vehicles," said Ammar Master, director (South Asia), automotive, GlobalData, a data analytics provider.

Eventually, the e Vitara will make its way to India, and it is expected to challenge the incumbents here. While India’s electric passenger vehicle market is still at a nascent stage, pegged at about 2.5% of the total passenger vehicle industry in CY24, it is projected to grow to over 5% by 2025, according to S&P Global Mobility.

With sales of the e Vitara expected to commence around Q2 this year, GlobalData expects full-year 2025 sales to be lower than 40,000 units globally. But those are projected to double to around 80,000 units over the next three years. Importantly, 79% of this volume will come from the Indian market.

“They want to test the waters in more evolved EV markets before offering thevehicle in [India] their biggest market," said Avik Chattopadhyay co-founder of Expereal India, a brand consultancy firm. “One must understand that the Indian customer has huge expectations from Maruti Suzuki. The brand cannot act in haste. So, they will learn from the experience in Europe and Japan, build the charging infrastructure and then launch in India."

That launch may not be too far away. A couple of Maruti dealers from the North told Mint that while the company has not sent them any intimation about the start of deliveries, they expect bookings for the e Vitara to open soon.

And when that happens, the stock market is certain to take note. The Maruti Suzuki stock has climbed 17% in the past year, comfortably beating the benchmark Nifty50 (up 6%) and edging past the Nifty Auto index (up 15%). However, it is way behind Mahindra & Mahindra, the top performing auto stock of the year, which has soared 84% on the back of its aggressive push into EVs.

The market is clearly paying a premium for EV play, with analysts saying Maruti Suzuki’s upcoming electric models and price points of the offerings will be near-term triggers for the stock.

Taking on Tata Motors

As a new entrant in the EV segment, Maruti has some catching up to do in India. Thus far, it has steered clear of the EV lane despite the flurry of activity by its rivals there in recent years. A slew of launches has seen the action heating up in the market, and the e Vitara’s entry will only add to it.

Tata Motors dominates the market with a 61% share (in FY25 to date), backed by technical know-how from its subsidiary Jaguar Land Rover (JLR), which had entered the EV space earlier. Mahindra & Mahindra, in hot pursuit of the leader, has just brought in two ‘born electric’ models (XEV9e and BE6e).

Hyundai, meanwhile, has just driven into the mass electric market with the Creta electric SUV, which will be pitched against the Maruti Suzuki e Vitara. It will also compete with Tata Curvv EV, MG ZS, and Mahindra BE6e. MG Motor, along with JSW, is strengthening its EV portfolio.

Maruti Suzuki's strategic emphasis on expanding its EV presence in India, Japan, and Europe stands in contrast to Tata Motors’ sharp focus on the Indian market. The Tata company is still evaluating foreign markets for its electric vehicles. Currently, it only exports EVs to Nepal and Bhutan. Those models include the Xpress-T, Tiago electric and Punch electric for Nepal, with the Nexon, Punch and Curvv EVs going to Bhutan. In the domestic market, however, the company has sold two lakh EVs so far. It has a larger bouquet of EVs on offer, from hatchbacks to SUVs, with the Harrier electric set to join its portfolio soon.

But in India, too, Tata Motors has been seeing a decline in EV fleet volumes since last year due to the expiry of the Faster Adoption of Manufacturing of Hybrid and Electric Vehicles (FAME II) subsidy in March 2024.

“In Q3FY25 we registered 19% growth in the domestic personal segment, although our fleet volumes declined year-on-year due to the expiry of FAME II subsidy," said Shailesh Chandra, managing director, Tata Motors Passenger Vehicles and Tata Motors Electric Mobility. He, however, added that the company’s new launches, including Curvv electric and Nexon EV 45, are seeing strong customer traction.

Moving beyond India is not going to be easy for Tata Motors. “Tata has only sold commercial vehicles in major markets, unlike Suzuki, which has had a global footprint in the passenger vehicle space for nearly half a century," said Kwan Wongwetsawat, senior analyst, global powertrain, GlobalData.

Tata Motors’ main market should be India over the next four-five years, said Puneet Gupta, director–automotive, S&P Global Mobility, especially with sister concerns like Tata Power, Tata AutoComp Systems and Agratas helping in localisation and expansion of its e-mobility ecosystem.

On that count, it may have a slight edge over Maruti. The e Vitara, for instance, may not have the same level of localisation as the company’s gasoline cars. A lot of parts may have to be imported, including battery cells. But pricing needs to be aggressive, given the competition and small market. So, it will not have the same margins as an ICE vehicle.

The Maruti management has already indicated in its Q3 FY25 earnings call that profit margins on EVs will not match ICE vehicles over the next few years. “If the profit of an electric vehicle was equal to that of an ICE vehicle, why would the government support so much at the central and state level," said Rahul Bharti, executive director, corporate affairs, at Maruti Suzuki India. “The fact that there is a drastic reduction of GST (from 12% to 5% from August 2019), and that there are so many subsidies at different levels, demand side and supply side, means that that there is a difference (in profitability)."

Toyota partnership

Japanese companies haven’t quite warmed to electric vehicles the way their rivals have globally. Instead, they have been championing hybrids and, in Maruti Suzuki’s case, compressed natural gas-powered vehicles, as well.

At an event a few years ago, Maruti Suzuki chairman R.C. Bhargava had even expressed scepticism about the focus on EVs, noting that India gets 75% of its electricity from coal, so electric vehicles would merely be shifting their emissions from their exhaust pipes to power plants.

Last May, London-based climate-focused think tank InfluenceMap had released a report noting that Japanese automakers, including Toyota, Suzuki and Mazda, were the least prepared for an electric vehicle transition and were, in fact, engaging the hardest against it.

Viewed against this backdrop, the e Vitara’s introduction is a shift for Suzuki, and by extension, for its partner, Toyota. Suzuki has a global partnership with Toyota to share their product platforms and technology. The e Vitara’s export markets will prove to be a useful learning ground for both companies.

“The first BEV will be supplied to Toyota globally," Toshihiro Suzuki had said last October. The first BEV unit and new Heartect-e platform (on which the EVs will be built) adopted for this model, were jointly developed by Suzuki, Toyota, and Daihatsu Motor Corporation, utilizing each company's strength.

Last May, London-based climate-focused think tank InfluenceMap had released a report noting that Japanese automakers, including Toyota, Suzuki and Mazda, were the least prepared for an electric vehicle transition.

It is also part of the larger Toyota-Suzuki gameplan in Europe. “Toyota will test the EV waters in that market with the Suzuki badge, learn and then decide on the larger portfolio, both for Toyota and Suzuki," Chattopadhyay maintained.

Toyota is the world’s biggest carmaker, and its global reach is phenomenal, which will help it turn India into an export base for BEVs, noted S&P Global Mobility’s Gupta. “If they export the e Vitara on their badge, they will be able to fetch more of a premium than a Suzuki brand vehicle," he added.

Growing export footprint

The strong export focus for the e Vitara is significant. Maruti Suzuki, the market leader in India, is now the country’s largest exporter of passenger vehicles, having edged past Hyundai Motor India in FY22.

In Q3FY25, Maruti Suzuki’s exports crossed the 99,000-unit mark, easily surpassing the 95,000 or so vehicles it had exported over the whole of FY21. Those exports, however, are largely of internal combustion engine (ICE) vehicles.

Over the last four years, Maruti has put in a lot of effort to expand its global footprint. These initiatives have finally paid off, especially in Africa, the LatAm region, the Middle East and Asean region.

A slew of model launches, favourable customer responses, a dense dealer network, customer reach, easy financing, and a speedy complaint handling system seem to have worked in the carmaker’s favour.

The e Vitara will be the first EV to be ‘made in India’ and exported to Japan. Earlier, the company’s Baleno premium hatchback had made headlines when it became the first Made in India car to be exported to Japan.

The five-door Jimny SUV is also now being exported to the Japanese market and has received a positive response with 40,000 bookings. In India, it has faced dwindling sales since its rollout in June 2023, pitched against the sturdier Mahindra Thar off-roader.

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Globally, EV sales slowed in CY24 from the previous year, but are still increasing, especially in the US and China. In Europe, the e Vitara’s launch market, they have decreased by around 1% since 2023. “Nevertheless, we expect overall sales in Europe to recover, and the e Vitara-equivalent segment to be a key player in the BEV space," said GlobalData’s Wongwetsawat.

For Maruti Suzuki, the e Vitara could mark the beginning of a shift that will play out in the years to come. Immediately, as the company adapts to the intricacies of the international automotive landscape, its export-driven approach may serve as a model for other manufacturers aspiring to harness India’s advantages in the electric vehicle domain—if it succeeds.