Maruti Suzuki started as a company with no hope: R C Bhargava

Looking at the sales numbers and the balance sheet of Maruti Suzuki it's almost impossible to imagine any struggles for the company. In fact, the company with the largest market share in India enjoys a healthy lead over its rivals. Hence, it came as a surprise when R C Bhargava, Chairman, Maruti Suzuki, said that the company started out as a company with no hope. Speaking at a press meet, Bhargava said that when Maruti Suzuki started operations in 1981, the company started out as a company with no hope.
This was primarily due to the company starting its operations in a socialist economy. He added that at that time the economic environment wasn't great and the PSUs (Public Sector Undertaking) weren't performing well. Cars were at the bottom in terms of priority for the government but were one of the highest-taxed products.
"No one thought at that time that India would become the fourth-largest car market in the world", he added. However, Maruti Suzuki defied all odds and went on to become a successful example of Indo-Japanese collaboration. Bhargava said this was mainly down to the way the Japanese and Indian work cultures were merged to form a new work culture for Maruti that enabled better results.
The journey to becoming the largest carmaker in the country, however, wasn't easy for the company. Bhargava said the company not only survived but achieved feats such as helping develop a vendor ecosystem that continues to play an instrumental part in the company's dominance over the market. "What works in Europe or elsewhere in the world cannot be copy pasted in India for success. At Maruti Suzuki we developed an ecosystem that drew upon the best practices from the management practices of India and Japan to suit the Indian market", he added.
Speaking of present times and the challenges ahead, Bhargava said that India is one of the most heavily taxed countries in the world in terms of car ownership. He also mentioned how too many slabs in the taxation structure make things difficult for the companies as well as consumers. At the same time, he also mentioned that shrugging off the legacy burden of old governance will take some time as the government also needs to ensure that immediate revenues aren't affected negatively.
Speaking of future growth, he said that the present government has made efforts to improve things and make the business environment easier but the desired result is yet to be seen. He attributed this partly to the policies that are not friendly for businesses in some states of India and how their policies do not align with that of the central government.
He also stressed on the fact that in the end if India is to grow to its true potential, manufacturing needs to improve vastly. Referring to improvement in manufacturing, Bhargava added that Maruti Suzuki has also set up a foundation that will help improve local manufacturing further by drawing upon the learning of the Indo-Japanese collaboration for Maruti Suzuki over the last 40 years.