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S. Muralidhar

AVID cricket fans may have missed the import of the string of ads that Maruti Udyog aired during the recent ODI series between India and Pakistan. But the message of the commercial was clear — Maruti is out to woo the 40-million-plus two-wheeler owners in the country, and offer them a chance to upgrade to the Maruti 800.

For almost 15 years, the Maruti 800 was the undisputed king of the Indian road. When competition from the Koreans, Americans, Italians and one of the own "desi" companies poured in, the M800 was being dismissed as having lost its relevance. And yet, for a car that was frequently referred to as one that will soon be pulled out of production, amazingly sales of the M800 have showed no signs of tiring.

Despite its anachronistic design and technology, the reason the M800 is still one of the most aspirational cars in the country is not far to see. For the extremely price-sensitive Indian consumer, the gap between the two-wheeler and a car is too wide to bridge. In the absence of an organised used-car market and the prospect of purchasing a relatively unreliable second-hand car, most two-wheeler owners tend to keep postponing their car purchase decision.

To the Indian psyche, a new car will always remain a status symbol even if it is the entry-level model of the M800. In terms of technology, though Maruti has only brought in multi-point fuel injection (MPFI) and nothing much to the M800, the company has ensured that the car remains one of the most reliable and easy to maintain at the lowest cost. Reliability has also been improved by constantly adding such new features as disc brakes in the front, coil spring suspension at the rear instead of the old leaf-springs, radial tyres instead of the previous bias-ply tyres (even in the base variant) and a collapsible steering column. Running costs for the M800 are also probably the closest a car can get to a two-wheeler.

For the potential entry-level car buyer, who takes solace in numbers and the fact that a product has found wider acceptance, the M800 is simply the most affordable car that offers reliability, good resale value and low maintenance costs.

So, it is not surprising that Maruti's latest marketing initiative targets the two-wheeler owner. Being an entry-level car, the M800 has always been the car that two-wheeler owners will aspire to upgrade to; this time the company is making a concerted effort to make the car even more affordable.

Called "Dho se Char" (two to four), Maruti's new strategy leverages its alliance with the State Bank of India, enabling it to offer an extremely low EMI (equated monthly instalment) of Rs 2,599 for the M800.

Under the scheme, the car buyer finances the M800 purchase through an SBI loan for Rs 1.58 lakh and only has to only pay the remaining as a down payment. With a tenure of seven years, the interest rate on the loan works out to about 9.75 per cent, on reducing balance basis.

The new two-to-four strategy has been designed after an extensive nationwide market research effort conducted by Maruti Udyog. The market research about two-wheeler owners and their aspirations omission threw up the following interesting insights for Maruti:

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