Maruti expects Brezza petrol to replace diesel volumes 1:1
14th Nov 2019 10:50 am
The trend towards petrol SUVs will help the upcoming petrol Vitara Brezza’s sales believes Shashank Srivasata, Executive Director, Maruti Suzuki.
The Indian automotive industry is in the midst of a prolonged slowdown but there are early signs of a recovery. Market leader Maruti Suzuki, which had seen volumes drop for seven straight months was one among few carmakers to post a year-on-year sales growth in October 2019. Sales grew 2.3 percent in October 2019 to 139,121 units, on the back of strong performance in the compact vehicle (Wagon R, Swift, Dzire, Celerio, Baleno and Ignis) and utility vehicle (Gypsy, Ertiga, XL6, Vitara Brezza and S-Cross) segments. The big question is if Maruti will be able to sustain the momentum, especially at a time when the carmaker is mere months away from pulling the plug on diesels in its line-up. The concern is that the absence of diesels will leave Maruti exposed in crucial segments – like SUVs – that have traditionally been diesel-centric. However, there is optimism within Maruti on the matter.
In an interview with Autocar India, Shashank Srivastava, Executive Director, Maruti Suzuki expressed the potential of the soon-to-be-launch Vitara Brezza petrol to completely replace volumes lost with the phasing out of the existing diesel version. “If you see the entry, middle and upper SUV segments, it is only in the upper segment that demand for diesel SUVs seems to be much more. Our Brezza operates in the entry-level. As you know, we will be getting a petrol Brezza, and we hope to have a one-to-one replacement of the diesel volumes.” Srivastava said.
Expanding on the matter, he added, “I know this sounds too good to be true for Maruti Suzuki but I think one of the big factors we’ve been very encouraged by is the response to petrols of some of the new (SUV) launches. Most of the vehicles were actually entirely diesel in this category, earlier. They used to be launched with diesels.” Citing examples of the changing trend towards SUVs, Srivasata said, “The (Hyundai) Creta has a good percentage coming from petrol, actually 35-40 percent. If you look at the Seltos, 60 percent of the bookings is petrol. In fact for the MG Hector, it is very high: almost 70 percent of the booking is petrol. And this is in the current level of diesel prices vs petrol prices.”
Speaking specifically of the entry-level SUV segment where the Vitara Brezza has long reigned supreme, Srivasata said, “We are very confident, because once you have BS6 diesel options coming in this category, the price difference (between petrol and diesel versions) will become substantial, even more than what it is today. Even today, the bookings coming on for our competitors are substantially in petrol.” In the period from May-September 2019, the Brezza-rivalling Hyundai Venue, that’s available with two petrol and one diesel engine options, sold 42,681 units with the petrols making up 57 percent of sales.
Srivastava did hint that the Brezza petrol – that will launch with a facelift – might not play the price card like other Maruti models. The Brezza petrol will come with a Suzuki’s new K15 1.5-litre petrol engine whose 1,462cc displacement would disqualify it from excise benefits on ‘small cars’. Cars under 4m in length and with engine size less than 1,200cc for petrols and 1,500cc for diesels are taxed at a lower rate in India. The current Vitara Brezza (3,995mm long and powered by a 1,248cc diesel engine) comes under the lower tax structure. “Pricing policy will play a big role but yes we would expect 10,000 plus sales every month” Srivastava added.
This 1.5-litre unit is the same one that powers the Ciaz midsize sedan and Ertiga MPV and will come with Maruti’s SHVS mild-hybrid system, providing the compact SUV with a segment-first feature. However, this 1.5-litre petrol-mild-hybrid setup won’t qualify for tax sops either.
Since launch in March 2016, the Vitara Brezza has sold an average 10,995 units a month. The compact SUV recorded its best monthly sales in October 2018 (15,832 units) and lowest monthly sales in July 2019 (5,302 units). Brezza sales once again breached the 10,000 mark in October 2019 with 10,362 sold in the month.
If things pan out the way Maruti expects them to, the Vitara Brezza petrol could start just where the diesel signs off, at the top of the segment.
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