Suzuki Bullish on India: Vehicle Market to Boom Fivefold by 2047

22 Jul 2024 , 11:57 AM

According to Suzuki Motor Corporation Executive Vice President Kenichi Ayukawa, India’s automotive market is on track to exceed 20 million units by 2047, aided by potential development in battery electric vehicles.

First, Maruti Suzuki India Ltd., the Japanese automaker’s unit, aims to capture 50% of the market by 2030, up from roughly 40% in the fiscal year ending March. “We’re confident that the Indian market will expand in the mid to long term,” Ayukawa said in an interview.

The growth of India as an economic superpower, as well as its growing middle class, present a clear potential for the Hamamatsu-based company, which has been involved in the South Asian country since 1983 and has established itself as the best-selling automaker with models such as the Swift and Brezza. According to Ayukawa, Suzuki hopes to release its first EV in India and Europe next year after showcasing its mass production model at the forthcoming auto expo in India in January.

“We’ll develop products, invest and expand our network,” Ayukawa told the crowd.

According to the Society of Indian Automobile Manufacturers, 4.2 million passenger automobiles were sold in India for the fiscal year ending March 31. To put that number — and Ayukawa’s projection — in context, 3.1 million passenger cars were sold in the United States last year, while Europe experienced 15 million unit sales. The International Organisation of Motor Vehicle Manufacturers reports that China is the world’s largest automobile market, with 26 million passenger vehicle sales.

Although Suzuki’s planned eVX is a high-end electric vehicle, the company will also release more inexpensive and compact variants with lighter batteries, according to Ayukawa. Suzuki plans to have EVs account for 15% of company sales in India by 2030, he said.

“India faces environmental issues so I think EVs will grow to an extent,” Ayukawa told Reuters. Although customers are paying more for cars than they used to, “India remains a price-conscious market,” he stated.

Nonetheless, Ayukawa believes that automobile customers are more interested in crossovers and sport-utility vehicles. Competition is fiercer in that market since it is a “strong area for Tata and Mahindra,” he explained.

Tata Motors Ltd., India’s third-largest automaker, has already grabbed the lead with fully-electric versions of its popular Tiago and Nexon models, and it expects its EV business to be profitable by early 2026.

According to Ayukawa, Suzuki will focus on models that can be used on a daily basis, which will necessitate the development of new battery technologies. Suzuki may begin domestic cell manufacture over the next 5 to 10 years, he added.

In terms of collaboration in India with Toyota Motor Corp., which formed a strategic alliance with Suzuki in 2019 for a 5% interest, Suzuki would most likely focus on smaller cars, while Toyota will lead on larger models, according to Ayukawa. Toyota’s EV technologies will also strengthen Suzuki’s product development, he added.

“We will learn basic know-how from Toyota and gradually make it our own,” Ayukawa informed the crowd.

Suzuki also sees potential in automobiles fueled by compressed natural gas, which is less expensive than petrol in India, according to Ayukawa. Maruti Suzuki sold 483,000 CNG automobiles in the most recent fiscal year, a 47% increase from the previous year.

Although Suzuki intends to begin running four plants that convert methane from cow manure into fuel for cars that now run on CNG, Ayukawa said there are obstacles ahead, such as monetizing the organic fertiliser left over after making the fuel on a wide scale.

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