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Maruti-Suzuki suffering "Intel Chip-Like" challenges

14th June 2024, 16:32 by Rahul Nagaraj

I feel that Intel missed some really big opportunities & trends. Maruti is guilty of doing the same.

GTO recently shared this with other enthusiasts.

Just like Maruti is in cars (Indian market), Intel is h-u-g-e in the chip market. If you are reading this from a laptop or desktop, odds are, your machine has an "Intel Inside" sticker on it. Also like Maruti has done to the Indian auto sector, Intel defined the chip market, enjoyed a dominant market-share and generally kept all of its customers happy.

Unfortunately, again like Maruti, Intel has been out of tune with market preferences since a while. My newest laptop which is blazing fast & has a 10-12 hour battery life doesn't have an "Intel Inside". My Android smartphone doesn't have an Intel chip. And the last Maruti I bought was an Esteem in 1996...almost 30 years ago. I know it's the same for many other BHPians who haven't bought a Maruti in a decade or two.

Intel said no to making chips for the iPhone. A decision regretted by the company till date.
Intel completely missed the boat on smartphones. There is a less than 1% chance that your phone is powered by an Intel chip. Unexcusable, and similar to how Microsoft / Steve Balmer handed the Mobile OS market to others on a silver platter.
Nvidia has blown Intel away in AI chips.
ARM architecture chips have beaten Intel in the price : performance ratio on smartphones.
Even in the area of laptops & desktops, Apple's M3 Chips are way more powerful than anything from Intel, and way more efficient. I am typing this post from a Macbook Air 15" which offers supercharged performance with 10-hour battery life, and zero heat or fan noise. Longtime partner Microsoft is bragging about ARM chips lately.
Intel made big mistakes in the GPU market & admitted to the same. NVidia destroyed Intel in graphic cards & owns 90% of the market today (Intel's market-share is almost 0).
In the server industry, biggies like Amazon, Google etc have started developing their own chips due to Intel's pricing & dirty business tricks.

Similarly, Maruti is missing major market trends & preferences:

Don't get me wrong though. Maruti is the no.1 carmaker in India for very, very solid reasons. I too love many Maruti models like the Fronx 1.0L Turbo MT, Ertiga / XL6 for the comfort, WagonR 1.2L for the practicality, 2024 Swift...but there is no doubt that the company hasn't really evolved in the last 10 years as a dominant market-leader should. As the BOSS of the market, you have to dictate trends...lead them...not fall behind miserably. Just like Intel still has many good chips on sale, even Maruti has some great cars in its portfolio. But the company has long stopped behaving like the No.1 and hasn't kept up with the times. Neither is it future-ready. Why do you think Suzuki sold a part of its company to Toyota? Reason = Fear.

A "culture of cost-cutting". Maruti's USP from day one has been cheap parts, continuously lowering costs with suppliers, saving a couple of bucks on a roofliner, 2000 rupees on interior plastics, sub-4 meter hatchbacks or value-for-money cars etc. The formula totally worked till 10 years ago. Since, customer preferences have evolved where they are willing to pay a more money for better quality. Customer aspirations have risen & how! But Maruti's line of thinking & culture remains the same it has been for 40 years. That is, mediocre quality at mediocre prices. Sit in the Grand Vitara, then come back and post here what you think of the interiors. Worryingly for Maruti, its average-selling-price per car is lower than the likes of Hyundai, Kia, Mahindra etc. From 46-47% market-share a decade ago, the company's share of the pie hovers in the 40% area currently. Still dominant, but lower...and I repeat, with a lower average selling price per car.
The market wants premium 20-30 lakh cars, but Maruti simply doesn't know how to build a "high quality premium car". Yes, Maruti just doesn't have the in-house capability to build an XUV700, Punch EV or Seltos 1.5L Turbo today. Hyundai-Kia have really beaten Maruti black & blue here, while even homegrown boys (Tata & Mahindra) are successfully selling competent 25-30 lakh rupee cars. Other than a Toyota-rebadged model (Invicto), Maruti has nothing above 20-lakhs and certainly no product that offers "premium quality". The market is screaming "we want premium'ish products & will pay a premium rupee for it". Maruti screams back "here is yet another value-for-money car with ordinary interior quality and a boring powertrain". The Grand Vitara gives you two powertrain choices with either 102 BHP or 114 (!!!)...and one of the motors is a triple cylinder! Hyundai-Kia will sell you a 158-BHP Turbo Petrol. Mahindra will happily deliver a 200-BHP turbo-petrol or 180-BHP turbo-diesel to you tomorrow.

Drive the Punch EV back-to-back with any compact Maruti and you will feel that Maruti has fallen at least 10-years behind the learning curve.

When Maruti thinks premium, it's for a car like the Jimny. All of us enthusiasts love the cute 4x4 and its capability, but Maruti's over-confidence led to over-pricing the car, and it flopped on launch.

Electric Cars! I would expect a market-leader to stay on top of emerging technologies that are proving popular with tech-savvy customers...cars that have a younger age profile, thousands of customers pay premium bucks for and a technology that the government wholeheartedly supports. Nope, Maruti is still in the "testing" phase of EVs, while others have been happily selling them & wowing customers for years.
Turbo-Petrols, Dual-Clutch ATs etc. Yes, Maruti has one turbo-petrol, but that is hardly available across the range. The big engine you will get however is a boring 1.5L naturally-aspirated petrol that feels like it is from the 1990s. Mated to a transmission also that is from the 1990s.
Falling behind in technology: ADAS in a Maruti? Nope. If you own a Maruti and want ADAS, click here. A chauffeur is the only type of advanced-driver-assistance-system you're going to get in a Maruti today. Note: I am not a fan of ADAS at all, and never use it, but it is a technology that showcases how tech-friendly a car manufacturer is. ADAS is a barometer of the carmaker's R&D ambitions.
Turbo-diesels still sell & that's a fact. One cannot be a market leader and not offer an option that tens of thousands of customers choose each month. Especially in Crossovers, MPVs & SUVs, Maruti is at a serious disadvantage by not selling a diesel, when there is so clearly a market demand for them. The worst part is this = Maruti built a fantastic 1.5L turbo-diesel that totally wowed me & Kanad at the time of our review (link). On a scale of 10, I'd give that Maruti diesel an 8.5 or 9. Shockingly, Maruti wasn't prepared for BS6 emission norms. How is that even possible? The government had given ample time for everyone to prepare, and other manufacturers sure did successfully. Maruti's superb 1.5L diesel sold for about a year, before being pulled out of the market. Inexcusable, I tell you.
A complete lack of innovation. While Hyundai, Kia, Mahindra, Tata etc. are bringing the latest technologies to mainstream segments, Maruti just doesn't bring anything new. Exhibit A = CNG cars. For decades, Maruti has been the bestselling brand of CNG cars. Good economy, but boot space totally gone. It is Tata who came up with the "twin cylinder" CNG tanks that give you boot space as well as CNG's low running costs. Drive the Tiago CNG and just see how well-thought out its CNG implementation is. Or how Hyundai-Kia innovated with the IMT gearbox. This lack of innovation in a market-leader is appalling (and very "Intel" like). When was the last time you checked out a new feature / tech in a Maruti and went "whoa, that is something"?
A culture of "fuel economy above all else". Does FE matter in India? You bet. But it is no longer the sole criteria for customers. Look around at the best-seller models and you will see that the customer is willing to give away a little bit of fuel economy for a little better performance or driveability. Maruti is tonedeaf here. They launched the 2024 Swift with a 3-cylinder engine (instead of the outgoing model's 4-cylinders), with an engine making lesser power, and Maruti bragging "it has even higher fuel economy!!!". I disagree here. It's like Toyota saying, here is an even more reliable Fortuner. FE is already Maruti's strength & it has to start playing some new cards now.

Maruti is stuck here

But the market has moved on to this. Aspirations

Safety. Customers are clearly becoming more conscious of their safety (and that of their families), and our desi boys (Tata & Mahindra) have truly done their homework. But, does anyone here associate Maruti with safety? Can you believe, that in 2024, Maruti doesn't have a single 5-star safety-rated model on sale?
Maruti is also falling behind the curve on features. Forget their other models, even the 23-lakh rupee Grand Vitara doesn't have premium sound (subwoofer, amp), auto wipers, electric seats etc. at a time when the market is literally yelling "we w-a-n-t features". The recently launched Swift doesn't get an auto-dimming IRVM (!!!!), TPMS (literally 1000-rupee cost for OEMs), a sunroof or properly sized spare tyre. The Brezza was actually the last car in the segment to get a sunroof!
Some models are just royally ignored & left to wither. The Ciaz today feels like a vintage car & is the oldest sedan on sale in India. The Ignis is 8 years old. The Ertiga (an especially important product to the bottomline) and WagonR are over 5 years old, and talk is only of facelifts (not all-new generations). The Ciaz is perhaps the oldest car you can buy for 12-lakhs, along with the antique Mahindra Bolero.

I feel that Intel missed some really big opportunities & trends. Maruti is guilty of doing the same. In fact, one can see some similarities with Hero MotoCorp too.

Posts like these from Maruti owners feel like a TL;DR summary of what I have taken 1600 words for. He revisits Maruti after 20 years and says:

Posted by BHPian Sober_Motorhead:

Had Zen’s and the Esteem 1.3 in the 1996 – 2004 periods.
Currently use an XL6 automatic, from the Maruti stable.
What’s not changed much in 20 years:
Largely retains fun-to-drive characteristics.
Felt fragile then. Feels fragile now.
Rattle prone (improved from the Zen though).
High road noise.
On bad roads, feels like it will fall apart - but never does.
Won’t leave you stranded on roads due to breakdowns.
Refraining from safety-related comments.
What’s changed for the better:
Nexa service center lounges.
Service center coverage.

Here's what BHPian ninjatalli had to say on the matter:

What still holds the fort (and that 40+% market share) for Suzuki is the dealership network reliability. Yes, dealerships are more and more focused on fleecing the customers but the trust factor is still strong among the masses. Hyundai and to a limited extent Mahindra & Tata are trying to get there but are nowhere close enough.
I once faced a significant brake issue in my Scross on a long trip to Goa. Pulled in the nearest service centre (and only one) in a remote tier 2 town (and hundreds of kms away from a proper city), and my issue was diagnosed by a bunch of young mechanics with some support over the phone from a bigger service centre and the issue was figured out and corrected. I can't with confidence say that can be done in a Hyundai or a Tata situation. Faced a lot more trouble with my VW even when exposed to only metro-based service centres.
Till the time Maruti-Suzuki has this benefit over its rivals, the masses will still stick with Maruti. Maybe in a decade (if they continue like this), they might slip to #2 but only time will tell.

Here's what BHPian theAutomaniac had to say on the matter:

This thread takes me back to 2019 when we used to have similar threads because all Maruti cars back then, were outdated.
The biggest problem in my opinion with Maruti is Suzuki! Suzuki for the past 10-15 years has been nothing but a carmaker that is dependent on India and a liability for Maruti! They try to extract the maximum profit and maximum royalties out of Maruti and India, just so they can continue selling cars in the rest of the world.
And the problem with being the provider of a dependent and ventilator-ridden family is that you often have to compromise on spending on yourself! Because if you start focusing on yourself, the dependent people will die.
Hence why, if Maruti wants to take the risk of entering bigger segments, they will have to develop new engines, new technology, and set up new production lines, all for something that might not be as profitable as their current crop of cars! Therefore their masters sitting in Japan won't allow this because it will reduce their profitability!
Maruti was ready for BS6 diesel and EVs back in 2019 with the E15A and WagonR EV respectively, but Suzuki shelved their plans due to lack of initial profitability! Even on the enthusiast's side, Maruti was kicking it in Motorsports but had to withdraw because the masters wanted to make more money! Maruti was ready with India's second-best warm hatch Baleno RS (First being Abarth), and best diesel crossover S-Cross 1.6 in 2017 but had to stop selling due to the masters!
So unless Maruti breaks from the shackles of Suzuki, I don't see them bringing any out-of-the-world tech in their cars!
That said, I don't think Maruti is as bad as this thread portrays!
The internet makes us believe that India demands faster cars when in reality, most Cretas. Slavias and Kushaqs sold on roads, are the slower and more frugal engines. Only Virtus, Sonet, and Seltos have dominant sales figures for turbo-petrols, and that too is only because their go-fast versions look a lot more sportier than the regular versions!
Case in point, Hyundai itself had to discontinue the i20 Turbo and restrict that engine to NLine due to low sales, and the same might soon happen to Creta.
Even regarding EVs, Maruti's first Born-EV is set to be launched in 2025, which is in line with the timeline of Born-EVs of other manufacturers like Hyundai and Mahindra.
The only problem with Maruti IMO is the lack of premium image and lack of a base to build bigger cars on. Hopefully, we will see Maruti addressing these pretty soon.
Regarding features, I will agree that Tata is doing a lot better than Maruti. But, what about quality and reliability? I just need to put out a search on Google saying "XYZ Tata car issues/breakdown", and 1000s of articles will pop out! Even on FB groups of these carmakers, people are facing issues with parts as basic as the gearbox and wiring!
With Maruti, you won't have a car that has all the trendy tech, but you will at least have a car that you can trust!
Even in the case of Hyundai, old 1st gen i20, Verna, Accent etc are non-existent, while 1st gen Swift, Dzire, and even low-selling models like Ritz are still very common. This again proves that instead of a great experience for 5-7 years, Maruti focuses on providing a good experience for 15+ years! They are basically a low-budget Toyota, also the reason why Toyota picked them for partnership!
Regarding innovation, they are developing a series-hybrid engine, and are working on multiple other technologies as well, simply highlighting that Suzuki is also investing, but rather in the long term and not in trendy and short-lived stuff!
So, does Maruti have a problem? Yes! They need to do better at making premium cars.
Do they have an Intel-like problem? No! They still have their basics right and a strong future lineup. And they also know the Indian customer better than anyone else!
That said, the new generation not buying Maruti is a serious problem for them. A lot of people in my own circle have swayed away from Maruti unless for small cars. Even I don't see myself buying a Maruti unless it is a Jimny or a Grand Vitara AWD. (And I won't keep either of them in stock lol)