Same Destination, Different Routes

Maruti and Hyundai are both chasing lost market share, but their strategy couldn't have been more dissimilar

- By HIMANI KOTHARI

TWO MAJOR CARMAKERS IN India are accelerating toward the same destination—market share recovery—but are taking sharply different routes to get there. While Maruti Suzuki is steering towards entry-level cars, Hyundai Motor India is doubling down on sport utility vehicles (SUVs).

Maruti's market share has fallen from 51.3 percent in FY20 to 40.9 percent in FY25. The country's largest carmaker wants to get back to 50 percent market share by FY31 for which it has planned ₹70,000 crore in capex and cut car prices drastically.

Its hatchbacks, Alto and S-Presso, are roughly 25 to 30 percent cheaper after the Goods & Services Tax (GST) cut in September and are now back near the 2019-2020 price territory.

SMALL-CAR MARKET
“Festive demand was driven by small cars, not SUVs,” Maruti Suzuki Chairman RC Bhargava said during a post-earnings media call in November. “India is inherently a small-car market.”

He argued that the recent decline in hatchback sales was because of lack of affordability and not because Indians' aspirations had changed.

“Many could not afford to buy the more expensive small cars earlier, and now that prices have come down, they have returned to the market,” he explained. Eighty-five percent of Indian households still earn far below ₹15 lakh a year.

GST on small cars was reduced to 18 percent, from 28 percent earlier, with effect from September 22. The demand surge was immediate.