Might bring CNG compatibility to NEXA showrooms: Shashank Shrivastava

Shashank Shrivastava, executive director of sales and marketing, Maruti Suzuki

After an uncharacteristic slump, Maruti Suzuki, still the largest-selling car brand in India, is on a campaign to reclaim sales it lost to supply chain issues, the absence of a mid-sized sports utility vehicle or SUV and shifting customer preferences.

With the launch of the new XL6—the marquee’s second multipurpose vehicle or MPV offering that’s positioned a notch above the Ertiga on which it is based—that is sold under the NEXA premium sub-brand, the company aims to highlight its commitment towards ensuring occupant safety and in a bid to improve its abysmal safety ratings of the past, the XL6 comes with four airbags as standards.

But while the supplementary restraint system offers protection only the driver and the passenger in this six-seater car, with the company hopes to balance the scales with segment-first features like a 360-degree camera, tyre pressure monitoring system, electronic stability control (ESC) and hill-hold assist apart from a slew of infotainment novelties.

Maruti Suzuki chose to launch the XL6 with a petrol engine only with the brand’s executive director of sales and marketing Shashank Shrivastava saying there’s “no economic logic for opting for diesels”.

With more than 325,000 pending deliveries across models, Maruti Suzuki faces an uphill battle when it comes to meeting customer demand during a supply chain crunch. It has to do this while also managing customer expectations in the face of rising component and commodity prices. Shrivastava discussed this and more in an interview. Edited excerpts:

How much of the MPV market do you hope to claim with the XL6?

Right now our market share is about 61 percent in the MPV space. And the XL6 does about 3,500 units of the total market, per month. A total market of roughly 22,000. We hope with this car, we will increase the market share even more.

One of the highlights mentioned has been the inclusion of quad airbags and other safety features such a tyre pressure monitor as standard features. How much of this additional focus on safety has been prompted by the Global NCAP tests?

I would say as far as safety is concerned it has always been a priority for Maruti Suzuki. We have always made sure that our products match the standards set out for the industry. We have always exceeded them. Most of our vehicles have “Suzuki Hard Tech” technology which uses high-tensile steel, which is very solid in terms of crash safety. Apart from that we also believe that there are other elements of safety, both passive and active. Like in this case, we have a 360 camera, a tyre pressure monitoring system, ISO-Fix points etc. So I would say safety has always been a priority. I wouldn’t say it was prompted by NCAP.

But quad airbags for the front passengers haven’t been offered in the past, even by the competition.

We always make that assessment of what the consumer really wants. And we have to balance it out with the overall product. Our research showed that people wanted that number of airbags. The requirements of consumers are different in different categories.

If you were to weigh it against the consumer’s preference for tech features and comfort over their growing preference for safety, would you say safety takes precedence now?

I don’t have a direct research result comparing the two. Both are important and consumers want both. Some consumers give weightage to comfort but many are prioritising safety. We try to take care of both in our product portfolio.

What sort of market penetration do you expect from the electric vehicle or EV segment by 2030 and in comparison, where do you see the CNG car market?

Generally the expectation is about 10 percent by 2029 (for EVs). According to our calculations, between today and 2030, India will see sales of 70 million cars in total, so out of that 7 million will be EVs. CNG penetration is increasing. It was merely 3-5 percent a few years back. For Maruti Suzuki it’s about 16 percent of total sales, and about 2-3 percent of each of our models sold with a CNG variant. CNG sales are also related to the number of cities which are covered and the stations that we have. The city count has gone up from 126 a few years back to almost 250 now. The number of stations has gone up from about 1,500 to almost 4,000 now.

The plan for expansion is very good. Some 330 cities are to be covered in the next few years, with over 10,000 CNG outlets. And the prices of diesel and gasoline also matter, along with the comparative prices. So there are a lot of unknown factors but the general trend seems to be that the cost of running ICE-only vehicles is pretty high and therefore CNG demand would continue to be high.

Can we expect NEXA to also bring CNG compatibility into its fold?

Earlier we thought that the NEXA customer would not be interested in a CNG car. However, our research has shown us that the cost of running, even for a NEXA customer, is quite important. We’re now studying the market for whether CNG for NEXA is feasible.

Given NEXA’s positioning as a more premium sub-brand, is the frugal nature of a CNG vehicle likely to conflict with the brand’s positioning?

Exactly the reason why we had thought earlier that it might not match with the aura of NEXA. But the on-ground response from consumers seems to be different. They are clearly indicating that the cost of running is a very important factor. That’s why we’re considering it.

Is Maruti Suzuki’s focus going to be on an entry-level EV, which is the need of the hour, or realistically, given the time frame and the costs associated with EVs, on a more upmarket Rs 10-lakh-plus electric SUV?

It’s difficult for me to provide specifics. As a concept, different segments have different points of breaking even in terms of total cost of ownership, so it depends. But I’m afraid I can’t talk about it at the moment other than to say that we will be launching our first EV by 2025.

Given that 2025 has been earmarked as the year Maruti Suzuki will launch an EV, by which point some of the competition would be launching their second- or third-generation EV offerings, is Maruti Suzuki using this additional time to better engineer battery technology for Indian conditions?

The EV market is still in an evolving stage. Last year it was only about 2.3 percent of the overall market. And the reason why the acceptance of EVs has not been widespread is because of the cost of acquisition and the charging infrastructure. The former is dependent on the battery cost, and battery technology is not available that can bring the cost down.

For Maruti Suzuki, we will be testing in very Indian conditions. In deserts, high-altitude areas. We are also investing heavily in battery infrastructure.