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Maruti's sedan hopes in top gear

Maruti Suzuki may have kept competition at bay by strengthening its bread and butter small car portfolio, but sedans have remained its Achilles heel. While the M1000, Esteem, Swift Dzire and even the SX4 did well, there were other models that failed to excite the buyer. The high-margin space, especially the premium A3 segment, has mostly remained uncharted for the 'king of small cars', as a result.

The recent sales of the heavily-promoted Ciaz (see table) suggest that that may change for the Delhi-based company.

Of late, it has done well with the runaway success, Swift Dzire, and the SX4 to an extent, in sedans. Ciaz, the mid-sized sedan, based on a new platform, launched in October, 2014, could continue its successful run, and in a desirable category, at that. The Ciaz saw average monthly sales nearly three times of Hyundai Verna, a former champion in the space.

Of course, the Japanese Honda City remains the country's top-selling sedan with average monthly sales of 6,500 units, according to the Society of Indian Automobile Manufacturers (SIAM).

Maruti Suzuki's intention of diversifying beyond small cars is evident from the seven sedans it has launched so far, more than any of its competitors in sedans. The models which have been phased out are M1000, Esteem from the nineties, Baleno, Kizashi and the SX4.

Of the more recent launches, the fully-imported Rs 15-lakh Kizashi had the shortest lifespan for a Suzuki car, as it was discontinued in less than two years of launch. A Rs 5 lakh discount was offered on it to liquidate its inventory.

Launched in 2007, the SX4 had a promising start but succumbed to a competitive crowd comprising not just the City and Verna but also the Volkswagen Vento, Nissan Sunny and Skoda Rapid.

The Swift Dzire has, so far, been the best-selling sedan, at an average of 18,000 units a month, not just for Maruti Suzuki but also in its class. However, the car is a compact sub-4-metre model ,based on the Swift platform, and does not play in the lucrative mid-sized segment.

"By the end of 2013-14, it was clear that for Maruti Suzuki to grow in the mid-sized sedan segment (A3), it needed to grow in the upper A3 segment. This was the right time to focus on it. However, in this segment, it was to be the challenger brand, that needed to fight", says a market analyst who tracks Maruti Suzuki.

Ciaz may play in the A3 segment, but it has been benchmarked against A4 sedans, a segment higher than the City and Verna, and consisting of the Toyota Corolla, Skoda Octavia and Chevrolet Cruze, claims the company. Creature comforts in the car include a push-button start, calling and audio controls on the steering, reverse-parking camera and assistance, better rear seat comfort with rear airconditioning, sunshade and a 12V power socket. The top-end variant comes with an infotainment system with a 7-inch touchscreen, Bluetooth connectivity, navigation and voice command.

Randhir Singh Kalsi, executive director, marketing and sales, Maruti Suzuki India, talks about the lessons drawn from the previous A3 sedan, the SX4: "There was a lot of learning from SX4. We took all measures in advance, we brought on board a special team, we trained them at a higher level for five-10 days to handle Ciaz customers. The 360-degree marketing included viral marketing also".

Maruti Suzuki opted for a new face to promote the brand. The brand ambassador, Ranveer Singh, was known for his journey from a non-Bollywood background to becoming a star, a trajectory that Maruti Suzuki hopes challenger Ciaz would chart too.

"Ranveer Singh, a new entrant, with no roots in the industry, made the perfect fit as a brand ambassador. With his attitude and performance he looks ready to take on the world and challenge the established order", says a Maruti Suzuki executive.

Around 88 per cent of Ciaz buyers are male. But less than one-third of the buyers are below the age of 35 years. The company's research says that 45 per cent of the buyers considered competitors, while 45 per cent were determined to buy the Ciaz.

But Maruti Suzuki's competition is not sitting quiet. Hyundai, which slipped hard in the rankings, will unveil a refurbished Verna this month with an aim to recapture lost share. The new Verna will have revised styling at the front and back, and an improved suspension and steering.

The German Volkswagen, which has been quiet for a while now, will launch a refurbished Vento later in 2015. There are crossovers planned by Hyundai and a premium hatchback by Honda that would compete with the A3 sedans, as well, this year.