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Maruti Suzuki India (MSIL), the leading player in the Indian small car segment, has announced price reductions for certain variants of its popular mini cars, the Alto K10 and S-Presso. The move comes amidst a significant drop in sales of these vehicles over the past several months. The company aims to stimulate demand and revitalize the shrinking mini car market.
In August 2023, MSIL sold a total of 10,648 units of the Alto K10 and S-Presso, representing a 12.8% year-on-year (Y-o-Y) decline. The overall sales for the company in August also suffered a drop of 8.4% Y-o-Y, reaching 143,075 units. This decline was attributed to the company's strategy of limiting vehicle dispatch to dealers, who already held a substantial amount of unsold inventory.
The price reductions are effective from September 2, 2023. The S-Presso LXI petrol variant saw a price reduction of Rs 2,000, bringing its price down to Rs 4.995 lakh. The Alto K10 VXI petrol variant received a more significant price cut of Rs 6,500, with its new price standing at Rs 4.995 lakh. This strategic move by MSIL reflects the company's proactive approach to addressing the declining demand for small cars.
The demand for small cars in India has been on a downward trajectory for several months. This trend is attributed to various factors, including shifting consumer preferences towards larger vehicles, rising fuel prices, and increased interest in SUVs and other segments. While the overall car market continues to grow, the mini car segment is experiencing a contraction.
Despite the temporary setback, MSIL remains optimistic about the future of small cars in India. Chairman R C Bhargava expressed confidence that demand for hatchbacks and sedans would revive by March 2026. He emphasized the importance of low-cost, small cars in India's socio-economic landscape and stated that the company's long-term strategy remains unchanged. The company believes that the mini car segment will eventually rebound, driven by factors like affordability and the continued need for fuel-efficient vehicles in a developing economy.
The price reductions by MSIL are expected to have a positive impact on sales of the Alto K10 and S-Presso. By making these vehicles more accessible to budget-conscious buyers, the company aims to stimulate demand and boost sales in the short term. However, the long-term success of this strategy depends on factors such as the overall economic climate, fuel prices, and consumer preferences. The future of the mini car segment in India remains uncertain, but MSIL's proactive approach and unwavering belief in the segment's potential suggest that the company is prepared to weather the storm and emerge stronger in the long run.
Source: Maruti slashes prices of Alto K10, S-Presso variants amid drop in sales