Shashank Srivastava, ED-International Operations, Maruti Suzuki expects the auto industry to end the year with a tepid growth of 6-7%.
"Q4 (January-February-March 2013) is very large quarter, large base and because of the large base growth may not look. I do not expect very large growth figures in Q4," he said in an interview to CNBC-TV18.
He added that the new Alto F8, which was launched in mid-October has received good response because of the festive season. It has already crossed the 50,000 booking mark and the company has retailed more than 30,000 vehicles.
Meanwhile, the country's largest car maker recently announced that it will increase the prices of its vehicles across all models by up to Rs 20,000 from January due to increasing pressure on its margins due to currency fluctuation.
Below is the edited transcript of Shashank Srivastava’s interview with CNBC-TV18.
Q: How thing went through the festive period? What kind of sales performance you are expecting over the next couple of months?
A: If one takes the cumulative for this financial year, April to November the industry has grown roughly 9.7 percent and Maruti’s growth has been 8.7 percent. This is despite some of the production constraints that we have had because of the Manesar issue.
Q4 (January-February-March 2013) is very large quarter; large base for last year and I do not expect very large growth figures in Q4. Overall, the industry should end up with something between 5 to 7 percent of growth overall. In April to November the shift to diesel continued.
Now diesel vehicles form 57 percent of the total market, but that has relatively stabilized in the last three-four months. Going forward, because of the large base growth may not look as good ending up the year with probably around 6-7 percent.
Q: There is a lot of talk that you are going to up prices across models starting January. Can you confirm that and also tell us how significant a price increase you are looking at?
A: I will not be able to talk about that, but we have already indicated that the prices would go up in January. The quanta will be difficult for me to comment on.
Q: Can you give us an update on how the new Alto 800 is doing with some numbers and what kind of projections you have?
A: We have two types of Alto; one is Alto K10, which has got 1000 cc engine that was launched a couple of years ago. The Alto F8 - the new Alto has replaced the old Alto 800 cc. The new model has done very well. So far we have crossed the 50,000 booking mark.
We have already retailed more than 30,000 vehicles. So the going has been good. Let us see how it goes going forward because we launched it in mid-October with the start of the festive season and next few months will be a real test of how it will do.
Q: On pricing though, on which categories is it that you all are keen to increase prices and by when. Will it happen within this calendar year or come January?
A: It is not my area, so it will be very difficult for me to comment on it. But we have already indicated that the prices should go up in January.
Q: How is market share splitting up right now especially in some of your key categories?
A: Maruti Suzuki’s overall market share was more than 40 percent market share in November, but April to November our market share is just about 38 percent. It is little bit down over last year, but we have been recovering the ground which we lost last in July-August because of the loss of production.
As far as segment wise share go, Ertiga which we launched in April has given us very good numbers. We are doing about 7,000 numbers a month and that segment has been growing. The multi purpose vehicle (MPV) segment is now about 13-14 percent of the market.
That was entirely new for us, our market share in that segment considerably increased. In multi-utility vehicle (MUV) segment in which our market share was just around 2 percent has increased significantly now because of Ertiga.
For the intersegment wise contribution to the overall sales, there have been very interesting changes. In this year so far, we have seen a huge growth in the MPV and MUV segment and also in the A2+ segment, but the other sectors have relatively been sluggish especially, the smaller car segment.
Q: How is the international market looking for you? What kind of growth do you see there in 2013?
A: Our international market volumes last year were roughly around 127,000. We would end up with around similar figure this year as well. One of the reasons is that Europe has declined considerably because of tough economic situation there. But we have made up the numbers with the non-EU exports.
Our exports especially to Latin America and Africa have increased greatly as also in Association of South East Asian Nations (ASEAN). 2013 is going to be tough year as well because Europe is not going to come up; it is not expected to come up in the next couple of years. In fact the projections by analysts for next year for Europe are that it could be lower. Except for Hyundai and Kia this year no manufacturer has grown in Europe.