Maruti Suzuki Tops Algeria in Terms of Exports

Maruti shipped around 17,247 units of cars to the North African country, Algeria which made this country the largest Indian export market in the year 2011-12 ahead of neighboring Sri Lanka with 15,359 cars and Indonesia with 10,551 cars. When asked about the new car export destination which Maruti choose this year, Mr. Mayank Pareek, marketing head of Maruti Suzuki, replied with the famous story of the two shoe salesmen who were sent to assess the market potential of a town. One of them said that people don’t wear shoes so there is no market and other salesmen said that make them wear shoes. Mr. Mayank explained the situation of Algeria’s market same as of that town in the story. He added that customers in Algeria either buy big cars or they don’t buy cars.

Maruti intervened this market in the year 2000 because it is similar to the Indian market where people are value conscious buyers and the country has low motorization but growth was registered in the market share just three years ago. This growth of Maruti Suzuki in the Algerian market has given the opportunity to target the other African countries as well. Maruti exported 1,27,000 odd cars in the year 2011-12 out of which around 23,000 cars went to Africa which was double the number of cars exported to Africa last year. Hyundai India sent 75,000 cars to Africa which is a number boosted by its Korean parent company using it as an export hub of i10 and i20. The African and Latin American markets have a good potential for the car and for long term, that is the reason behind tapping these markets.

Maruti registered 1,14,000 units of exports which can be accounted as 77 percent of the total exports in the year 2009-10. European government provided the “scrappage incentive” to increase the sales and a similar strategy had been followed by UK government which gives a bonus of £2,000 to the buyer scrapping an old car. These schemes increased the demand of the small cars and the exports from India multiplied to 4,40,000 in past two years. The African and American market will soon fill up and then these small car makers have to search a new market. The sales of African and American countries have increased the market share from 23 percent in 2009-10 to 66 percent in 2011-12.