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Alto is Maruti’s new hot wheels as M800 takes beating in July

03-August-2004
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Alto is Maruti’s new hot wheels as M800 takes beating in July

The country’s largest car manufacturer, Maruti Udyog Limited (MUL), sold 43,419 vehicles in July 2004 against 41,781 vehicles in July 2003, an increase of 3.9 per cent, the company said in a press release put out on Monday. But there is a bigger story tucked away in between the lines: the Alto is the new champ with the Maruti 800 taking a beating.

Sales of the ubiquitous Maruti 800 (A1 segment), the country’s highest selling car by far and MUL’s bread and butter model since its inception in 1983, fell by a whopping 42 per cent to 9,554 units this July from 16,398 units in July 2003. In contrast, the Alto has quietly surpassed the Maruti 800 to become MUL’s highest selling model at 11,111 units lapped up this July. In fact, virtually every third MUL model sold today is an Alto.

The Alto overtook the Maruti 800 for the first time in May this year. Then in June the 800 was ahead. But in July the Alto has again raced to the top.

There are many factors behind this turnaround. For starters, the company appears to have finally got the right fix on the Alto’s positioning, courtesy repositioning, introduction of a new entry-level version, and, most importantly, a price reduction that has brought it within striking distance of the Maruti 800. With the current success of the Alto, MUL appears to have got a grip of the B-segment at last. Riding on the Alto’s searing sales, MUL’s volume in the A2 (Alto, Wagon R, Zen) segment grew by 67 per cent at 22,833 units sold.

In the A3 segment (Esteem and Baleno) the growth was 85 per cent in July 2004 over July 2003, from 36,378 units to 39,841 units.

In defence of the Maruti 800, sources in the company aver that sales of the model in July 2003 were very high on account of the excise restructuring: pending orders had to be cleared that month; thus the 42 per cent fall this July, they claim.

Off the record, they also insist that MUL actually has an even stronger grip on the A1 segment than ever before. How? They argue that the Alto really belongs to the A1 segment alongwith the Maruti 800. In other words, MUL’s true peformance in the A1 segment for July 2004 is 20,665 units, that is, the aggregate sales of the Maruti 800 and Alto. Then why has the company placed the Alto in segment A2? Because that is the norm followed by the Society of Indian Automobile Manufacturers (SIAM). Time then for reclassification of segments and models?

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