Maruti Suzuki to Launch New Small Car in Hybrid, Flex-Fuel & CNG Forms
February 27th, 2025.jpg)
To arrest the declining sales of its cheapest cars such as Alto, S-Presso and Celerio, Maruti Suzuki, India largest car manufacturer, is planning to launch a new low-cost car. This car shall have a number of powertrains starting from factory-fitted CNG, flex-fuel and mild-hybrid variants. The aim of this small car is to regain 50% share by the end of this decade with a view to appeal to first-time buyers in the ₹5-13 lakh per annum segment.
As the passenger vehicle market in India is transforming, Maruti Suzuki wants to restore its small car business, its forte from the days of old. Discover all we have found out about the new car it launches and also learn how the automobile sector can gain from it.
Why is Maruti Suzuki Launching a New Entry-Level Car?
Low-end hatchback sales have been declining in recent times steadily. Small cars were the Indian auto industry's trump card, but now they are under severe competition from compact SUVs, which are extremely trendy nowadays. But as regards Maruti Suzuki, the small car segment still has enormous potential.
According to Suzuki’s President, Toshihiro Suzuki, small cars will continue to be relevant as millions of two-wheeler users aspire to upgrade to a four-wheeler. He emphasized that while small car sales have dipped, they remain significant when compared to SUV sales from rival manufacturers.
Maruti Suzuki's new small car is in Mid-Term Management Plan and targeted to introduce first-time automobile purchase entry-segment models. It believes that prices, fuel efficiency, and other alternative powertrains will come back to lure the market entry-segment buyers.
The Powertrain Options: Hybrid, Flex-Fuel, and CNG
Maruti Suzuki has established itself on the aspect of fuel-efficient and cost-effective cars, and the new entry-level model will also establish itself by offering a chain of fuel variants:
1. CNG Variant
Maruti Suzuki has been the market leader that is unmatched in the factory-installed CNG automobile business, with it having offered nearly all of its models in a CNG variant.
The new small car will be offered with a CNG kit from the factory, and with high mileage at low cost of running.
This is appealing to economy buyers, particularly to two-wheeler-upgraders or to low-cost runabout seekers on a daily basis.
2. Flex-Fuel Variant
The new car is one of the main strengths in that it is flex-fuel capable—a technology that allows cars to run on petrol with a higher concentration of ethanol.
India is going at a rapid pace towards the use of ethanol-blended fuel, and E20 (80% petrol, 20% ethanol) is already available for sale at a few petrol stations.
The government is also heading towards providing E85 (85% ethanol) fuel, and this would be a giant leap towards reduced use of conventional petrol.
Flex-fuel cars will be giving less emission and will be cost-effective for consumers.
3. Mild-Hybrid Variant
Maruti Suzuki has already equipped its bigger cars like Grand Vitara and Ertiga with mild-hybrid technology.
The new small car can expect to be equipped with a smaller hybrid engine, which will give improved mileage and improved fuel efficiency.
Hybrid technology will make fuel price hike disappear but leave behind an improved driving experience.
With these three powertrain choices, Maruti Suzuki will meet different customer needs as well as higher fuel prices and more stringent emission norms.
Challenges Facing the Small Car Market
1. Increasing Costs
Higher cost of ownership is one of the key drivers of declining small car sales. Adoption of more stringent BS6 emission regulations, mandated safety features (e.g., six airbags), and higher taxation have raised car prices.
For instance, the Maruti Suzuki Celerio has become pricier in recent years following the increase in prices after adding new safety features, making it less competitive for price-conscious buyers. The mass car segment is price-sensitive, and even a marginal increase in price has been proven to hurt volumes big time.
2. Changing Consumer Preferences
With rising disposable income, many buyers are skipping the small hatchback segment altogether and opting for compact SUVs like the Tata Punch, Hyundai Exter, or Maruti’s own Brezza and Fronx.
However, Maruti Suzuki believes that with the right features, affordability, and fuel efficiency, small cars can regain lost ground.
3. Declining First-Time Buyer Share
The share of first-time automobile consumers has reduced to as low as 40%, compared to its higher positions earlier a decade ago. Though India continues to have one of the lowest car penetration ratios (34 cars per 1,000 citizens), excessive prices, excessive loans, and increasing aspirations have been affecting the auto bottom-end.
How This New Car Can Help Maruti Regain Market Share
Market share dipped in Maruti Suzuki to 41% from weakness in the small car business. Although the company has been making consistent efforts constantly to regain lost market share by means of strategy-based launches.
The upcoming new small car, which will hit the roads in a while now, will turn out to be a game-changer in that:
This new small car is expected to be a game-changer by:
Offering alternative fuel options – CNG, flex-fuel, and hybrid to attract cost-conscious buyers.
Providing higher mileage – Expected to offer 30-40 km per litre, making it one of the most fuel-efficient models in India.
Targeting first-time buyers – Focusing on customers earning ₹5-13 lakh annually.
Competitive pricing – Expected to be priced between ₹5-8 lakh to keep it affordable.
It will offer alternate fuels like CNG, flex-fuel, and hybrid to meet the requirements of cost-conscious consumers.
Maruti’s Current Small Car Portfolio & Competitors
Current Affordable Maruti Cars:
Maruti Alto K10 – ₹4.09 lakh
Maruti S-Presso – ₹4.27 lakh
Maruti Celerio – ₹5.37 lakh
Rival Small Cars in India:
Tata Tiago (₹5.60 lakh)
Renault Kwid (₹4.69 lakh)
Hyundai Grand i10 Nios (₹5.92 lakh)
While new regulations keep increasing car prices, most companies have moved out of the budget segment. Renault is one of the few companies to have a sub-₹5 lakh car (Kwid), but Maruti Suzuki will still dominate this segment.
Launch Timeline & Expected Features
Although Maruti Suzuki has not hinted at any formal launch schedule, sources claim the new subcompact car to be included in the pre-FY 2031 timeline. It would fit a slot between Alto K10 and Celerio in company offerings.
Expected Features:
Modern Styling – A fresh design to attract younger buyers.
Infotainment System – A touchscreen infotainment system with Android Auto & Apple CarPlay support.
High Fuel Efficiency – Likely to offer best-in-class mileage.
Safety Features – Dual airbags, ABS, and possibly six airbags in higher trims.
Conclusion: A Bold Move to Revive Small Car Sales
With a new small car having hybrid, flex-fuel, and CNG options, Maruti Suzuki aims to gain back the place that it has lost in the entry-level segment. It wants to develop small cars with features like inexpensive prices, superb fuel efficiency, and alternative powertrains with the hope of rekindling interest in small cars in the Indian context of change in the automotive industry.
While SUVs outsell them, this new offering could very well be the answer to Maruti's dilemma because it has managed to balance its lineup while ensuring even the budget-spenders have an option to select from. Priced right, this car should be the one bringing first-time buyers back into the market, ensuring long-term sustainability for Maruti Suzuki.