Kei key to replacing Suzuki Baleno?

SUZUKI Australia wants to reclaim its spot as a budget car leader in Australia, with the brand considering a kei car replacement for the Baleno – a move that could see Suzuki selling the most affordable new car in the market.

The brand has held that position in the past with models like the Alto and Celerio, but in recent times the brand has seen significant price increases, leading to it no longer offering a sub-$20,000 vehicle in the Australian market.

Earlier in 2023 Suzuki Australia stopped selling its popular, affordable Baleno hatchback, which was the brand’s most affordable model until “production was switched off”. The Baleno listed from $18,490 + ORC, and its dismissal leaves the most affordable vehicle in the Suzuki ranks as the Ignis ‘light SUV’, which starts at $20,490 + ORC.

Suzuki Australia has committed to selling the Ignis for 2024, despite rumours of its impending demise due to a lack of any advanced driver assist systems (ADAS) technology. And the brand is also expected to offer the, Indian-made, Baleno-based Fronx coupe-style SUV too, but it isn’t likely to play in the sub-$20K bracket.

That seemingly leaves a gap to be filled in the market, with only the Kia Picanto and MG 3 remaining available under $20,000 in Australia – and Suzuki Australia general manager, Michael Pachota, says the brand is keeping an eye on that space, and suggested it could be the perfect playground for a Japanese-sourced ‘kei’ car.

The kei category is specific to the Japanese domestic market, referring to the smallest highway-legal passenger cars that are built to meet strict restrictions for external dimensions (3.40m long, 1.48m wide) and engine capacity (660cc). There is a burgeoning grey import market for this type of car, with a number of Suzuki models such as the Alto, Spacia, Xbee (Crossbee), Hustler, Every, Carry and Wagon R.

It’s the Alto that Mr Pachota seems most interested in. That model is available with two different powertrains in Japan, both of which come in at assertive price points. The first is the 2WD CVT petrol model, at 1,064,800 yen (AUD $11,050) and the other is a hybrid version with a bit more standard spec, at 1,218,800 yen (AUD $12,650).

“We're getting so much closer to it,” said Mr Pachota. “They're so spacey, the headroom and everything. I can really see a place in Australia for a kei car opportunity.

“So let me tell you -- if Japan says, 'we've got them, do you want them?', then two hands up in the air -- I want them all.

“One that really catches my eyes is the Alto, and as an offering in Japan, it's such a great entry level car that would - if you introduced it at a similar price or percentages based on their market versus our market - it would be a price leader in Australia, for the entry level to the Australian car market,” he said.

“That's something that really interests me,” he said. “But obviously, you know, there's customer expectations, too. There's safety expectations and so forth that need to be met, not to mention ADRs. So, relative to that, we can take a huge consideration into picking our vehicles carefully to match what the Australian consumer needs.”

Mr Pachota said that while the brand acknowledges the customer has less choice in the budget part of the market now than in years gone by, the sales slide hasn’t been that dramatic in the aftermath of Baleno leaving the ranks. Baleno accounted for 6000 cars just before it was axed, making it - at the time - the brand’s best-seller.

Mr Pachota stated the loss of the Baleno hasn’t gone unnoticed by the brand and by its customers, but that the business has been able to pivot to offer a better supply of the Swift small car, which itself is due to be replaced in 2024 with a new-generation model.

“With Baleno coming out of the equation, we saw immediately an opportunity to increase Swift sales, based on customer demand within that segment needing another offering, and Suzuki obviously being the brand of choice for the consideration of our customer we gave them that offering, the Swift, which we always had - but before they had two.

“Swift grew by just 60 per cent in sales for us, between the period of when we switched Baleno off to now, and I can see us increasing that even further into 2024 with current demand and enquiry that we'd have with the Swift product, which is great.

“To add to that, we also had Ignis grow by 25 percent as well,” he said.

To the end of November 2023, Suzuki Australia sales had seen a dip of 21.6 per cent, with 15,875 units registered.

The brand’s best-selling model in 2023 so far is the Swift, with 6486 units sold.

Other Japanese brands are seemingly considering the notion of a budget kei-car offering, including Mitsubishi Motors, which is reportedly considering the introduction of the EK X electric kei car.