Suzuki’s mantra is to create vehicles that are just the right size for transportation, lightweight, fuel efficient and safe and have sufficient equipment.Mumbai: Suzuki Motor Corporation believes that the target of producing four million cars in India by 2030 will mark a “turning point” for the company.
According to its Integrated Report 2024 which was recently uploaded on its global website, the Japanese automaker has stated that this production target will mean transforming its operations to “optimise" the organisation, facilities and work processes. “While solidifying our foundation in India, we will also explore the application of similar approaches in Africa going forward,” Toshihiro Suzuki, Representative Director and President, has stated in the report.
The company has observed that the last 40 years since it entered India have been “a history of both growth and setbacks”. While aiming to achieve an annual production capacity of four million vehicles by the end of this decade, it plans to construct and start operating plants with an annual production capacity of 250,000 units.
“This plan presents an extremely challenging task. While we can purchase facilities and plants with sufficient funds, human capital development takes time. Therefore, the key is attracting talented people and how to make them understand Suzuki’s culture and principles,” says the President.
Meeting new challenges
Moreover, the company believes it we must do more than just construct plants on land it owns. “We need to solve various issues, such as logistics issues accompanying growth, developing the surrounding environment, and complying with greening ratio requirements,” he adds.
Based on Suzuki Motor’s commitment to the ideals of “lighter, shorter, and beautiful products” and the idea that smaller vehicles have less impact on the environment, the core of its technological strategy has shifted once again to focus on energy-minimising technology, which reduces CO2 emissions from manufacturing to recycling.
“We believe that we should adopt a policy of using resources effectively and promoting carbon neutrality in line with the local community,” says Suzuki. Based on the Japanese philosophy of sho-sho-kei-tan-bi (smaller, fewer, lighter, shorter, beauty), the company plans to minimise the energy used and reduce CO2 emissions to the utmost limit.
“From manufacturing to recycling, we aim for technology that minimises resource and environmental risks, providing the joy of mobility to people around the world while striving to achieve a carbon-neutral world,” it has stated.
Small is beautiful
Suzuki’s mantra is to create vehicles that are just the right size for transportation, lightweight, fuel efficient and safe and have sufficient equipment. If a car weighs 200 kg less, it requires about 20% less energy for production and 6% less energy for driving. Compact and lightweight cars greatly contribute to the minimisation of energy consumption, notes the company.
According to Suzuki, sho-sho-kei-tan-bi requires less energy to move which translates into minimal battery size and fuel consumption. Small batteries require less energy to charge, help minimise motor size, engine displacement and material usage. Additionally, smaller products require less energy to manufacture and lighter ones result in lower collision energy, reduced recycling burdens, and lower costs and risks associated with raw materials.
“Furthermore, lighter cars cause less damage to roads and underground water or gas pipes, reducing the energy needed for infrastructure maintenance. Lightweight products create a virtuous cycle that brings numerous benefits,” states the company.
Since price and “user-friendliness” are important for mobility, which is closely connected to people’s lives, the Japanese automaker will strive to develop practical and valuable technologies that are also reasonably priced, lifestyle-oriented and those that meet the needs of the times. The idea is to prompt customers to say, ‘This is useful’ or ‘This is what I have been waiting for’.
New midterm plan
Suzuki is now in the midst of formulating its new midterm management plan where executive general managers gather “at lunchtime every week to discuss strategies for all business fields, including technology, until participants build a consensus”. Interestingly, there are more thorough discussions happening than in the previous management plan.
“Rather than creating a plan just for appearances, we will develop a highly executable one that ensures the passion and dedication of all Team Suzuki members—across product development, including technology, production, and sales—along with attractive product features, are delivered to our customers. We are determined to steadily achieve our growth strategy,” reiterates the top management.
Beyond this, the Suzuki head office at Yokohama in Japan along with Suzuki R&D Centre India and Maruti Suzuki will collaborate for “efficient development” by sharing the development in each field of future technologies, advanced technologies, and mass production technologies. The Suzuki Innovation Centre in Hyderabad is also exploring “new connections and innovations” for Suzuki Motor to “thoroughly take root” in India.
“We will enhance our manufacturing strength by collaborating with outside partners including start-up companies, Suzuki Suppliers Association, and cooperation with universities in Japan and India,” states the company.
Growing with Toyota
There is of course the all-important alliance with Toyota that was forged in 2016 and has been evolving rapidly with every passing year. The partners will now target this year for their electric SUV launches which will mark a big step forward in terms of accessing overseas markets with these offerings.
“We will deepen our collaborative relationship with Toyota Motor Corporation while continuing to be a competitor, and aim for sustainable growth and address various issues surrounding the automobile industry,” elaborates the report.
Through this alliance, there will be joint development in advanced technologies including autonomous driving and batteries of electrified cars, business expansion in “promising emerging countries”, efforts for carbon neutrality in India, as well as the formation of a “recycling-oriented society that considers the environment”.
Incidentally, Suzuki Global Ventures, a corporate venture capital fund established in 2022, is accelerating co-creation activities with startup companies by “exceeding the framework of each company and their conventional businesses”. It will make investments in areas that strive to solve customer and social issues and contribute to the development of ecosystems that grow with startups.
Biogas opportunitiesThe other big frontier for Suzuki is its biogas business which will use cow dung. “If left untreated, this cow dung may become a contributing factor to global warming. By refining biogas fuel from cow dung and producing organic fertilizer from the residue, this business aims to raise income levels in rural areas and contribute to India’s development,” states the company.
This biogas can be used for Suzuki’s CNG models that account for approximately 70% of the CNG car market in India. The company believes this this initiative will also promote economic growth and is looking to expand the business to other dairy farming areas in regions including Africa, ASEAN, and Japan in the future.
Whilst its strengths lie in producing affordable cars, Suzuki is also aware that in India’s total population of 1.4 billion, the primary customer base it serves is about 400 million people who can afford a car.
Reaching out to India’s masses“Recently, internal discussions at Suzuki have increasingly been focused on how we will monitor, understand, and build relationships with the income segment of roughly one billion people, primarily agricultural workers, who do not yet earn enough to afford a car or motorcycle,” states the report.
With India being a vast country comprising diverse ethnicities, the company believes that it is crucial to penetrate into the hinterland thoroughly, closely observe people’s daily lives and think more deeply about their needs.
“We are exploring how Suzuki can help solve people’s everyday problems and raise the standard of living for individuals. To do so, we believe the answers lie in the genba, genbutsu, genjitsu (actual place, actual thing, actual situation),” it has stated.
Since Suzuki was founded as a startup around 100 years ago, “we have survived and grown because we have worked tirelessly to solve problems from our customers’ perspective. This is something we must always remember”.
