'Maruti's low-cost strategy won't change'

Maruti Suzuki MD & CEO Kenichi Ayukawa has been leading the charge into newer categories in India since 2013 as the company moves out of the shadows of being just a strong small car-maker to a seller of bigger cars and running a premium retail network called 'Nexa'. It entered the mini-SUV category with the launch of 'Vitara Brezza' on Tuesday as part of this strategy. As the country's biggest carmaker - owned by Japan's Suzuki Motor - expands further into India, it is disturbed by issues like the Jat reservation agitation in Haryana. In an interview to TOI, Ayukawa said not only was he concerned about employee safety, it also led to production disruption at its Haryana plant. Excerpts...

Do episodes such as the violence during the Jat agitation in Haryana come as a setback?

A global investor is not familiar with this. It surprises us. Such issues should be fixed. It is very important to do so. We have over 100 people working at the R&D centre at Rohtak. It (agitation and violence) was a dangerous situation. There was a concern around the safety of our employees.

The Union Budget slapped an infrastructure cess on car makers resulting in an increase in vehicle prices. How does it impact you?

We were surprised and surely not happy. There will be an impact on generation of jobs and growth momentum. We are now looking at the possible implementation of GST.

How did Maruti manage to improve its market share over the last couple of years to around 47%? Some of your rivals are struggling to get even 1%...

We have had a 30-year history in the Indian market. In 2011, we analyzed the product portfolio and stressed on affordability. After I came here in 2013, we focused on that plan along with building a collaborative leadership with the Indian team. We also brought in new technologies and worked on products which are suitable for the Indian market.

Is it the focus on small cars and an extensive e service network that distinguishes you from others? What's the strategy going forward?

Affordable cars and low-cost strategy will not change. We have a sales network of around 1,800 touch points right now, which would more than double to over 4,000 in the next five years. So we will communicate better with our customers. By 2020, we hope to sell 2 million vehicles in India and we will continue to launch 2-3 new vehicles every year in the Indian market for the next few years.

Despite all your success in smaller cars, you don't have the same record in the premium segment…

It's a challenge, but we have done well in the small premium segment. It's a continuing effort.

Will you utilize the low-cost engineering learnings from India while developing products for the global market?

For us, vehicle development capability is more important. We are investing in training and development of our people and would continue to do so.

Reports suggest the dynamics of the global car market are changing with sales picking up in the US and Europe. Emerging markets, except China, therefore may not figure in the priority list of carmakers. Would that impact investment plans of companies here?

There could be issues in the short term, but it is unlikely that companies would reduce their focus on India. In fact, over the long term, investments will increase here.