Maruti just launched its most expensive offering in India, a luxury sports car, the Kizashi. In Japan, as a baby boy’s name it means “powerful”. As a car badge, Maruti says it means “prelude to good things”. In India, we will figure what it means once we get past the name. For a company that redefined the four wheeler landscape, Kizashi seems to do little to embolden Maruti’s lead as the maker of compact cars. Worse, it’s trying to woo an unfamiliar customer — the luxury seeker — at a time when competitive pressure in its bread-and-butter compact segment is building. It risks losing focus on both.
Maruti has built its reputation and numbers on one thing — that it’s a car for this nation. Not just a car that is affordable, a car that goes beyond. A car that can navigate through the stew of cycles, auto-rickshaws, buses, cows and human traffic on groaning roads, and engineering that can withstand tinkering by the friendly neighbourhood mechanic. By staying true to all of those attributes, Maruti has managed to produce and sell more than 1 million cars, making it a big giant on small roads.
So what is the Kizashi trying to say? By its own admission, Maruti is not aiming for volumes and promises to keep its eye on the small car segment. It does, however, rightly expect that there will be a big market for the luxury sports car. Kizashi is its placeholder. There are several problems with that choice. The first, and the more intangible of the two, is customer attitude. The second — it’s coming late to a sit-down dinner, where there is standing room only.
Maruti’s ambition to fuse steel, rubber and leather to produce a large luxury sports product is a noble one, especially in a world where premium brands such as Mercedes and BMW have often sized-down while keeping the premium marquee as a strong entry barrier. And others such as Toyota and Nissan have moved up with the Lexus or Infiniti and lifted their own brand worth. Except, Maruti’s badge is that of the lower, and medium vehicle. Its multiplier is middle class India looking for functionality and value, not attitude. Its largest selling car, Alto, is priced at about Rs 2.30 lakh — more than 30,000 units are sold each month, making it a brand whose numbers can hardly be rivalled.
Customers willing to spend about Rs 17.5 lakh on a petrol luxury car, in a country smitten by cheap fuel, are arguably buyers who have arrived. Typically they are not first-time users of a car and their ability to distinguish between brands will be quite sharp. Such buyers don’t drive the luxury badge, the badge drives them. Maurti, in 25 years, is yet to prove its badge has a luxury aura.
Then comes the rude reality. Two Japanese rivals, both Toyota and Honda have already squatted in the luxury spot with brands that have been top performers in international markets, be that the Accord, the Camry or the Civic. Besides, the Europeans are shoving for space with the Volkswagen and Skoda offerings. Their recall in India is that of a somewhat premium tag — those whose owners have fat wallets.
Sure, Toyota is trying to bust that perception with the Etios, which will try and woo Maruti’s Swift and Dzire users, adding to Maruti’s headache of outrunning GM, Ford, Hyundai, Nissan, Volkswagen and Tata in the chase for the sub-Rs 6 lakh buyer.
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Meanwhile, the market leaders of luxury, BMW and Mercedes, are pushing prices down and pulling the luxury customer up. Add this up and you have a Kizashi that seems too lean to be powerful and too late to be a prelude. If Maruti wanted to labour over an expensive baby, why wasn’t it a snazzy compact one — a luxury offering in the space in which it has the most recall?
Anjana Menon is Executive Editor, NDTV Profit. The views expressed here are personal