Will entry of Maruti Ertiga in MPV segment improve company’s market share?

Maruti Suzuki India entered the MPV segment with the launch of Maruti Ertiga on Thursday. With the aggressive pricing strategy, Maruti Ertiga is expected treat the company with success in yet another segment. The prices for petrol variants of Ertiga range between Rs. 5.89 lakh and Rs. 7.30 lakh whereas the prices of diesel variants of Ertiga range between Rs. 7.30 lakh and Rs. 8.45 lakh. All prices are ex-showroom, Delhi. Fiscal year 2011-12 did not prove very beneficial for the company and for the first time in its glorious history, the company witnessed a market share of less than 40 percent.

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The total sale of passenger vehicles in the country was 26.18 lakh units out of which MSI sales contributed around 10.06 lakh units resulting in the decline of market share to 38.44 percent. The sales figures in FY 2010-11 were 25.02 for MSI and the market share 45.28 percent. This was the perfect time to launch Ertiga for the company to regain its market share and MSI is sure to cash on this opportunity. According to the Managing Director and CEO of Maruti Suzuki India, Mr. S Nakanishi, over the last three years, the utility segment in the country has attained a CAGR (compounded annual growth rate) figure of 20 percent and the company believes that this trend is going to be continued in the future too.

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He added that the new Maruti Ertiga MPV is one of the key models that would be determining the performance of the company in India as well as global markets. Mr. Mayank Pareek, Managing Executive Director of Maruti Suzuki India mentioned that, for the past three years, the company has been calculating its market share including all the passenger vehicles. Generally the market share used to lie around 44-45 percent but this time the market share has gone down to 38 percent, he added. Mr. Pareek also indicated that the strike at the Manesar plant and the drift toward diesel cars resulted in waned market share.

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