Nexa may contribute 15% to Maruti Suzuki sales by 2020
Maruti Suzuki is confident of garnering about 15 per cent of its overall sales from Nexa — the separate dealerships to sell its premium cars — by 2020, according to a top company official.
“One year ago, people were looking at us with scepticism, saying that the Nexa strategy is a gamble… but the strategy has worked well for us,” said R. S. Kalsi, Executive Director (Marketing & Sales), Maruti Suzuki.The company sold about 1.3 million vehicles last year, he said.
Maruti Suzuki had earlier announced its objective to sell two million cars by 2020. Nexa, with sales of 1 lakh units in the past year, currently accounts for about a tenth of the annual sales of the country’s largest car-maker.
It retails only two models — S Cross and Baleno — from the 150 operational dealerships at present. Two more models (Ignis and Baleno RS) will be added by the end of this fiscal with the number of Nexa dealerships going up to 250.
Baleno-dependent
The sales from Nexa are currently dependent on Baleno which has a waiting period of up to eight months. Maruti had sold 70,000 units of Baleno and 30,000 units of the S-Cross model since their unveiling.Mr Kalsi said the long waiting period was a matter of concern and the company was working to reduce it.
“Production ramp-up is a gradual process. We have to align supply chain, which is complex… We should be able to see improvement in waiting periods in the second half of the year,” he said.
On the shift in consumer preference from diesel to petrol, he said the gap between petrol and diesel had been narrowing down with reduction in fuel prices.
Amit Kaushik, Country Head (India) at research firm JATO Dynamics said, “The idea behind the strategy was to handle premium customers. A customer buying Alto and one buying Baleno will have different attitudes. “This has turned out to be a good strategy for them,” Mr.Kaushik said.
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