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  The IUP Journal of   Brand Management :
NEXA: Attempting the Premium Connect
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This case discusses Maruti Suzuki India Ltd.’s—India’s largest car manufacturer—attempt to position itself as a seller of premium vehicles by launching upscale dealerships under the name ‘NEXA’. Maruti had been struggling for a long time to attract premium customers. It launched a number of premium vehicles, but each time success eluded the company. Maruti then realized that to target premium customers, it needed to focus on customer service and support. Moreover, it was not feasible to sell expensive cars along with affordable ones, as the upscale customer was increasingly looking for a unique buying experience. Although the initial response is positive, it is yet to be seen whether the ‘NEXA’ experience can actually deliver in the long run.

 
 
 

In the year 2012, the management of Maruti Suzuki, India’s largest car maker, began strategizing to find ways to position itself as a serious manufacturer of premium vehicles. The situation for the company was grim, as many of its customers were migrating or upgrading to other Japanese and European cars. For years, the company had attempted to break into the premium space; but success had remained elusive.

In the year 2009, it had launched the Grand Vitara, a Sports Utility Vehicle (SUV) priced at 16.67 lakh to 17.97 lakh, followed in 2011 by the premium sedan Kizashi priced at 15 lakh. The SUV failed to deliver due to lack of a diesel engine and Maruti’s inexperience in managing the expectations of premium class customers.1 Despite its impressive looks and good features, Kizashi too failed miserably. Within 18 months of launch, its sales dropped to 10 units per month, forcing Maruti to stop importing it in 2014. The company had to offer discounts up to 5 lakh to clear inventory.1 Ironically, Kizashi is a Japanese word for “sign of great things to come”. Both the Grand Vitara and Kizashi were imported as Completely Built Unit (CBU) from Japan.

 
 
 

Attempting the Premium Connect