Maruti to become bigger than Suzuki's global operations

Despite the rising competition in the Indian automobile industry, Maruti Suzuki has consistently managed to sustain its market share. Not only that, the company is growing at a healthy rate annually too.

An article by ET Auto mentions that R. C. Bhargava, Chairman, MSIL, boasts how Maruti is on the path to become a bigger company than its own parent company's global operations if it reaches sales of 2 million units. He also mentions that Suzuki's long term growth and future interests depends upon Maruti's growth. The automobile production ratio (as per 2013 reports) at 1.86:1 is more favorable to overseas production than domestic (Japanese) production, with India being Suzuki's biggest operation in the world.

At the moment, Suzuki Motor Corp holds 56.2% stake in Maruti Suzuki India. Maruti and Suzuki have been two of the world's fastest growing brands (year-on-year) in June 2014 - Maruti's sales grew by 27% while its parent company's sales improved by 23.5%.

Suzuki's overseas net sales have increased year-on-year primarily due to India and Europe (as per Suzuki's financial reports for FY2014 second quarter). The Swift hatchback sold 4 million units after 9 years and 9 months of its debut in 2004. India alone accounted for 50% of the global Swift sales while Europe sales were 19% and sales in Japan were 11%.

Recently, MSIL joined the elite club of companies with a market capitalization of Rs. 1 lakh crores. As of today, Maruti Suzuki exports cars from India to more than 125 countries including several European nations.

The company is now eying the lucrative SUV segment, which captures 20% of the passenger vehicle market. It is now aggressively targeting a 50% market share in India, with annual sales targeted at 2 million units. Currently, Maruti enjoys a market share of 47.87% in India.