Maruti Suzuki bets on new Z-series engine to drive fuel efficiency

Maruti Suzuki India Ltd is betting on its latest Z-series 1.2-litre petrol engine as it looks to make hatchbacks attractive to fuel economy-conscious buyers and reduce carbon footprint as part of the Corporate Average Fuel Economy (CAFE) norms.

The carmaker says its three-cylinder engine in the new Swift improves fuel economy by 14% for the automatic variant and 10% for manual.

"Fuel efficiency of most other models in the market is around 20 kilometres per litre. This engine gives above 25 kmpl," says Rahul Bharti, executive officer, Corporate Affairs, Maruti Suzuki.

Maruti Suzuki is expected to use the new Z-series engine in other new models where hybrid is not viable due to cost constraints. The Japanese carmaker's parent Suzuki Motor Corporation is working on low-cost hybrid technology for smaller affordable cars. But that technology is not there at the moment.

"Strong hybrids generally lend themselves to bigger cars," says Bharti.

Maruti Suzuki invested ₹1,450 crore to make the new Swift, including the money spent on developing the new engine.

Swift is an important model for the Indian market as well as for exports, says Maruti Suzuki managing director and CEO Hisashi Takeuchi.

"We can't let the same Swift go for ages. You have to have incremental model change at a certain point. The customer consciousness of safety, environment and fuel efficiency is becoming high. It's a good time for us to revamp the ongoing hatch Swift," Takeuchi says.

The fourth-generation Swift comes with six airbags as standard and a claimed fuel efficiency of up to 25.75 kilometres per litre, marking an improvement of 14% over its predecessor.

"We are doing a full model change of our successful model which is still generating enough volumes and enough profits for the company. We are doing the full model change so that the attractiveness of the product does not disappear and it keeps appealing to the customers," says Takeuchi.

The new Swift comes at a time when the share of hatchbacks in the car industry has seen a consistent decline over the past several quarters. Sales of hatchbacks declined 12% year-on-year in FY24 as the sport-utility vehicle (SUV) segment grew 28%, accounting for over half of total passenger car sales last fiscal.

"The hatchback segment is not disappearing. Our market share in the segment keeps growing," says Takeuchi. Out of 40 lakh cars sold last year, 12 lakh were hatchbacks. Maruti Suzuki cornered over two-third market share in the segment.

India's largest carmaker plans to expand its product portfolio to enter new segments where it doesn't have a strong presence. "We are going to introduce new products in areas where we are missing," says Takeuchi.

The carmaker is also betting big on compressed natural gas (CNG)-fitted petrol cars. Maruti expects CNG car sales to jump to 6 lakh units in 2024-25 from 4.5 lakh units in the last fiscal. The automaker sells CNG trims across various models like WagonR, Brezza, Dzire, and Ertiga. It, however, is yet to introduce a CNG variant for its popular hatch Swift. "CNG is growing very fast. Last year, we didn’t have enough components to cater to this growing CNG demand in India. This year we prepared well," says Takeuchi.