India needs low-cost small cars: Maruti Suzuki chairman

Maruti Suzuki India Ltd chairman R.C. Bhargava says that low-cost small cars are necessary considering India’s economic and social conditions and a temporary setback in demand is not going to change the carmaker’s strategy.

“We do expect the small car demand to revive. The nation has a need for small cars. We are waiting, maybe by the end of FY 2025-26, we should have the demand coming back,” Bhargava says at the annual general meeting of India’s largest carmaker.

“We are waiting that in the next year or two years, small car market will revive and a large segment of people at the lower end who are still scooter owners and want a more convenient, safer mode of transport under harsh weather conditions which we experience in the country and so I think that there is no question that this country cannot just do with larger and more luxurious vehicles,” says Bhargava. “A section of people wants vehicles which are more practical and so we need small cars as well.”

Maruti Suzuki is looking to export up to 800,000 vehicles by 2030-31 from about 300,000 cars currently. Its exports presently stand at 7% out of a total production of 2 million.

“Our target is that by FY 2030-31, we will be able to export 750,000 to 800,000 vehicles. This is just a projection. We have to see how global events take shape. How demand changes – it could become less, or it could become more. But roughly we should reach a figure of 750,000 to 800,000 vehicles of our total production of 4 million will mean close to 20% of our total production will be exports,” says Bhargava.

On electric vehicles, Bhargava says EVs are a priority objective not only for Maruti Suzuki but everybody. “We are in the process of introducing EVs. Our first EV model will be in production and out for sale in a few months’ time. We will be exporting the EVs to Europe and Japan. Over the next 6-7 years, we will be adding a total of 6 EV models to our portfolio,” he says.

“Electric vehicles are likely to be adopted gradually over the years as the multiple challenges facing consumers are over. There can be little doubt that during the period that this is happening, all other vehicles need also to become cleaner, so that the carbon emission and other environmentally degrading pollutants are minimised. We cannot let that continue unchecked, as that would only lead to adding growth to the atmosphere,” he says.

The first lot of electric cars that are soon to be produced would get exported to Europe and to Japan.