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Indian carmakers: The four-wheeled survivor

January 31, 2013

And now about that car
IT PROBABLY has the least auspicious origins of any carmaker. Maruti Suzuki?s antecedent firm was founded in 1968 by Sanjay Gandhi, a playboy scion of India?s ruling dynasty, whose qualifications included repeatedly being arrested for speeding in his Jaguar while on the rampage in England?and a mum who was prime minister. ?The Maruti was a disaster,? records an account of an early test drive. The firm collapsed in the 1970s amid claims of corruption.But from the ashes rose an Indian champion. With help from Suzuki, a Japanese firm, and freed from politics, Maruti was reincarnated and became famous for its cheap small cars. It survived a first wave of foreign competition in the 1990s. As late as 2010 it had a market share by volume in India of 48% (including exports) and mighty returns on capital. Suzuki, now a middleweight by global standards, raised its stake to 54% in 2002, taking control, but Maruti has kept its identity. Many Indians see it as an unlikely local hero in an era of global manufacturing.Big global carmakers reckon this is romantic tosh. Firms such as General Motors, Toyota and Volkswagen...

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