Japanese Car

Suzuki plans to sell cost-effective Maruti Cars in Japan

It has been 26 years since Suzuki Motors Corp. launched its first car in the Indian market under the brand name Maruti Suzuki. The company is now set to launch low cost Maruti car models in the Japanese automobile market, from where even Korea’s auto giant Hyundai Motors withdrew after stiff competition there had endangered its growth plans. The first Maruti model to be introduced in Japan will be the Maruti A-Star. Maruti’s importance is growing in the global plans of Suzuki Motors. It currently contributes to over half of the Japanese automaker’s profits and generated about 33% of its total turnover each year rising from just 10% in 2005-06. Maruti Suzuki a-star According to S. Nakanishi, Managing Director, Maruti Suzuki, considering the manner in which Maruti models are capturing the global market, the Japanese car market is certainly not far away.

The A-Star meet’s Europe’s stringent emission norms and is perfectly suited for hitting the highly developed market of Japan, where even top global car makers are finding it tough to survive. Maruti’s A-Star, though relatively new in the Indian market, contributes to almost 25% of the total exports (800,000 cars) by Maruti Suzuki. Currently, Maruti is developing several contemporary models, some of them being small cars, to be launched soon. By 2015, Suzuki will be investing Rs 60 billion (around $1.3 billion) in India to take Maruti’s production capacity per year to 1.75 million cars, and will also establish a new R&D center for producing cars on its own for the global market .

Nowadays, many Japanese automakers are shifting production to low-cost countries for taking advantage of cheaper labor costs and frugal engineering. Suzuki is already moving manufacturing to its overseas subsidiaries in India, Hungary and China, which contribute to over 70% of its total volumes. In comparison, the company is struggling in the sluggish Japanese auto market. Honda also will be manufacturing its Brio compact hatchback for international markets from the Greater Noida region in north India. Nissan has moved the production base of its compact car Micra for its international markets to Chennai in India from the UK, and to Thailand for the South East Asia region and Japan.

Today, Suzuki is a leader in the small cars category and WagonR (of which bigger variants are being sold in India) is the top selling Kei car since 2003 in Japan. Suzuki sells a significant number of the small Kei cars, some of these models being market leaders in Japan. Kei cars are very small yet sophisticated automobiles with 660 cc engines, a combination of nano design and the smallest engines in the world. Now that the Indian market is maturing rapidly, it won’t be long before Suzuki starts selling different Indian-manufactured cars in Japan.

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