Can the new Dzire revive Maruti’s sedan segment?

For Maruti Suzuki, the country’s largest automobile manufacturer, Swift Dzire as a brand has turned out to be a ‘golden goose,’ with more than 2.7 million sales since its launch in 2008. The old Dzire, under the Swift Brand, became the highest-selling sedan in FY24, thus giving a run for the money to its rivals such as Skoda Slavia, Honda Amaze, and Hyundai Verna, with more than 0.16 million sales. 
 
This year, Maruti Suzuki cut the proverbial umbilical cord between the Swift and Dzire brand and has launched the 4th generation Dzire at a starting price of Rs 6.79 lakh. In its first, the new Dzire also became the first product from the Maruti’s table, to receive five stars in the Global N-CAAP rating. 
 
According to Rahul Bharti, Executive Director-Corporate Affairs, Maruti Suzuki India Limited, as a market leader, Maruti Suzuki is trying to rejuvenate the sedan segment despite the recent slowdown. “As a market leader, it is our responsibility to rejuvenate the segment by bringing exciting products. We have to make efforts to cut the slowdown,” says Bharti. Sedan currently accounts for 8% of total automobile sales in the domestic market. Of this, Maruti’s share stands at 9.6%. 
 
For Maruti Suzuki, the entry-level Sedan accounted for 61% of sales. Through the new Dzire, Maruti Suzuki expects revival for the sedan segment. 
 
“Every second vehicle which is sold in the sedan segment happens to be from Maruti’s table. So we have got a market share of more than 50% in Sedan compact sedans and compact segment is higher at 61%,” says Partho Banerjee, Senior Executive- Marketing and Sales, Maruti Suzuki India Limited. 
 
The company has also launched a CNG version of the new Dzire, and has identified some key markets for the exports of the new Dzire. 
 
Maruti Suzuki is also trying to change the perception of the Dzire brand from ‘cab services’ by keeping the fourth generation Dzire strictly for personal vehicle use. 
 
According to Harshvardhan Sharma, analyst at Nomura Research Institute, the new Dzire is strategically positioned to rejuvenate the mid-compact sedan segment. 
“Maruti Suzuki Dzire is strategically positioned to rejuvenate the mid-compact sedan segment in India—a market that has seen its appeal wane due to the overwhelming shift towards compact SUVs. Maruti Suzuki’s dominance in the passenger vehicle market, with over 40% market share, gives it a unique advantage in tapping into this segment with the right product design and feature set to attract a price-sensitive yet increasingly tech-savvy audience,” observes Sharma. 
“The Dzire has traditionally performed well in terms of fuel efficiency, achieving over 24 km/l in the last generation. With Maruti Suzuki’s advances in hybrid and powertrain technology, the new Dzire could set new standards in fuel economy within the sedan segment, which remains crucial in a market where 60% of car buyers cite fuel efficiency as a top consideration,” he adds. 
 
For Maruti Suzuki, according to Sharma, the low cost of ownership factor, unlike its rivals, will be a decisive factor that could draw buyers back to the sedan segment, especially given the inflationary pressures affecting disposable incomes.
 
“Maruti Suzuki’s dealer network, the most extensive in the country, also plays a vital role in ensuring accessibility, with nearly 60% of potential car buyers preferring brands with strong after-sales support, especially in semi-urban and rural areas,” notes Sharma.