The government lessening regulations and restrictions after the early 1990s in the passenger car industry, formed the industry highly competitive. Maruti Suzuki India Limited has marked the success during the last three decades and now the brand “Maruti” has become a synonym for “car”. In presence of intense competition, the company was not able to raise its price during the last decade. However, Maruti generated the profit, but not enough according to its brand. The company is now encountering a risk of retaining profits for the future due to limited pricing and rising input costs.
Maruti decides to invest in a new plant in 2014. The executives and chairman of the company were evaluating that whether investing in a new plant would reduce the cost in its operations, so that the company could mark its targeted profit. The author, Ramakrushna Panigrahi, has the association with International Management Institute.
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