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Toyota And Maruti Suzuki's Badge-Engineering Success In India
Toyota's collaboration with Maruti Suzuki has significantly shaped its presence in the Indian automobile market, particularly through badge-engineered products. This partnership, operational since 2019 starting with the launch of the Glanza, now includes four such vehicles, making up nearly half of Toyota Kirloskar Motor's sales in India.
Over the past year, from May 1, 2023, to April 30, 2024, Toyota sold 2,49,737 cars and SUVs, with 1,09,706 units being rebadged Maruti Suzuki products. The lineup features the Glanza, Urban Cruiser Taisor, Rumion, and Urban Cruiser Hyryder, sharing underpinnings with their Maruti counterparts.
Why Badge-Engineering?
Badge engineering allows Toyota and Maruti Suzuki to share costs and boost volumes with minimal changes to the products. This strategy has not only been cost-effective but also well-received by buyers. It eliminates the need for Toyota to invest in new product development.
Prior attempts by Toyota to launch affordable cars like the Etios and Etios Liva didn't achieve the desired success, making this partnership a strategic move towards securing its market position without impacting the sales of Maruti's corresponding models.
Global Reach & Price Strategy
The partnership extends beyond India, with Maruti Suzuki's products being exported and sold under the Toyota badge in markets like South Africa. This global product-sharing strategy enhances the reach of both brands.
Interestingly, Toyota-badged cars are slightly more expensive than their Maruti counterparts in India. For instance, the Glanza and Hyryder variants are priced at approximately Rs 25,000 higher than the Baleno and Grand Vitara, respectively.
However, the price difference widens with the Rumion and Ertiga variants. Despite this, the recently launched Taisor's pricing strategy shows Toyota absorbing the rebadging costs for certain variants, indicating a nuanced approach to pricing badge-engineered products.
DriveSpark Thinks
The future of Toyota and Maruti Suzuki's partnership promises more badge-engineered offerings, including three-row versions of the Grand Vitara and Urban Cruiser Hyryder, alongside the Maruti eVX electric SUV and its Toyota-badged equivalent.
This indicates a sustained and evolving collaboration aimed at leveraging each other's strengths to cater to a diverse customer base, further solidifying their position in the competitive Indian automobile market.
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