Riding out a downturn with Maruti Suzuki | Value Research RC Bhargava, chairman of Maruti Suzuki India Ltd., talks about the auto downturn & upcoming policies & technologies

Riding out a downturn with Maruti Suzuki

RC Bhargava, chairman of Maruti Suzuki India Ltd., talks about the auto downturn & upcoming policies & technologies

Tighten your belt. The most severe downturn in the last many years has hit the automobile industry, the sector first to indicate economic health. And in some way or the other, this bad news is set to affect a lot of us even if our work and life revolves around different industries.

But there is something reassuring when the words "severe downturn" come from the grandee of Indian automobiles - RC Bhargava, chairman of Maruti Suzuki, India's largest carmaker. Because in the last 38 years of his service at this revered company, he has seen downturns come and downturns go.

I asked Mr. Bhargava for an interview when bad news on India's flagging consumer spending was coming in fast and thick (it still is) and he obliged. Great leadership doesn't stop communicating when times are bad. In fact, they communicate just as they do when times are good, in the same neutrality.

In a candid interview, Mr. Bhargava spoke about this downturn compared to the others and looked beyond that to speak about the upcoming policies and technologies that are set to change India's automobile industry.

Modest luxury
Maruti Suzuki is not opulent both in terms of the product it makes and its corporate culture. Their cars are robust, trustworthy, functional and modestly luxurious. Likewise, the company is transparent, serious, stable and conservative.

It is known to be deeply customer-focussed. It anticipates the demand from flood-hit states knowing precisely which components would be damaged by floodwaters and beefs up the spare parts supply at its service centres.

The chairman sits with the people. Right outside his office is the working bay with dozens of officers busy at their workstations. It is without boundaries. There is a hum that suggests people are talking, getting work done briskly and with ease.

In the visitors' area, trophies, shields and awards fill the shelves. In fact, there are so many, they are almost falling off. There are motoring awards, Japanese dolls, car models, paintings. There's a model of a large shipping container with tiny Maruti cars going into its hull. There is a silver Krishna's chariot.

To display them well, the company would need two and a half rooms with glass showcases from ceiling to floor. But clearly, the company is not resting on its laurels. At a time when sales have fallen over 30 per cent, it has a well-laid-out plan to practice Kaizen to make little improvements in its systems and processes that lead to big benefits.

The gig economy and change
Can a conservative company keep in step with radical change? The gig economy has brought in app-based cab services, cars on long-term rent and swanky public transport, thanks to people-oriented governments. This is one reason for the falling car sales.

Maruti's competitor has responded with an app-based cab service of its own. But Maruti will stick with its specialty, which is to make cars, as expressed by the chairman.

There is a lot of noise about electric vehicles and the government wants to push the industry into it quickly so that India gets a first-mover advantage in the world. Maruti is asking, 'where is the supporting infrastructure?'

Lurking in the background is also a new competition - Kia and MG are launching their cars and even though they are not yet in the small cars segment which is Maruti's preserve, what stops them from entering it in the future?

The hum picks up a higher note at the famed cafeteria where all people in their grey uniforms break bread together. There is a line up of dishes for lunch. It is truly tasty food as if lovingly cooked at home.

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