There is an SUV bandwagon that every Pakistani automotive assembler wants to be on. But one must acknowledge that only a handful will truly succeed at grabbing the market’s attention for a long period of time, and probably none at the scale already achieved by Kia, Hyundai, Changan and Sazgar. That Suzuki wants to climb this bandwagon via the launch of the Suzuki Fronx is noteworthy, not because of the ambition but because it hints at unease inside the country’s most dominant carmaker. Make no mistake, despite the many challenges that Suzuki has gone through in recent years—some visible, others less so—not having an SUV was never one of it. Suzuki’s most persistent problem has been that despite its overwhelming dominance in volumes; the company has struggled to scale into durable profitability. Over the years, Suzuki has sold on average twice as many vehicles as Indus Motors only to earn a fraction of the profits. Between FY14 and FY23, Toyota posted stable gross and net margins in the mid-to-high single digits, while Suzuki’s oscillated between thin, negligible, and negative margins. In more recent years, Suzuki sold more cars but still reported losses, even as Indus Motors continued to generate billions in after-tax earnings. Since Suzuki delisted from the PSX in FY23 however, its financials are no longer publicly available, making it unclear whether this imbalance has since narrowed or not. What is clear is that for most of the past decade, Suzuki’s Mehran, Bolan, Alto may have moved volumes, but they did not move the bottom-line. This is the financial context in which the Fronx is being launched. Today, Alto alone accounts for 25 percent of the auto sales (including vehicles offered by Kia and Changan), and together with Every, Swift, Cultus and Wagon-R, Suzuki would have 39-40 percent of the market share. The Alto in particular continues to fly out of the showrooms despite multiple price hikes not only because of the comparative affordability but because of the incomparable fuel average it provides to daily commuters and commercial drivers. But because these vehicles have thinner margins, they also leave little room for cost shocks or currency volatility. This perhaps also means that while the volumes have kept the factories busy, they have not insulated earnings. But if Suzuki’s answer to this structural problem is launching a SUV (or XUV) it may be betting on the wrong horse. To be clear, Fronx is not an SUV in the traditional sense. It is being marketed as a compact urban crossover for buyers hoping to upgrade from hatchbacksoffering design flair and interior space without the running costs of a larger vehicle. But this bet rests almost entirely on pricing. And pricing is perhaps Suzuki’s greatest Achilles heel. The Fronx is expected to land between Rs6-7 million which immediately places it in contested territory. At that price point, buyers are not merely upgrading from hatchbacks, they are choosing between established sedans, and newer Chinese and Korean offeringswith more size, power and prestige that have created their space in the market. This is where Suzuki’s long standing pricing problem surfaces. The company often prices its vehicles too close to better alternatives. The company’s popular brand Swift which is arguably a fan favorite sits awkwardly close to Toyota Yaris, a sedan with a much stronger resale. The new price for Cultus AGS edges so close to Swift that it will cannibalize its own showroom. This means an upward revision in the price of Swift is expected which only worsens the arithmetic. In the Rs4-5million range, there are a host of used JDM alternatives quietly eroding the value proposition of Suzuki’s locally assembled small cars. Fronx being marketed as a hatchback upgrade but priced like a crossover in a market flush with substitutes. Is that going to work? Suzuki has been down this road before. The Vitara failed not because it lacked quality or engineering integrity but because consumers were not willing to pay a premium for a Suzuki-branded crossover. It failed at the CBU stage. The Liana failed because the market, or rather the after-market was not prepared for it. The Ciaz failed because of too frequent price hikes of a stripped-down model. The underlying issue is that Suzuki’s pricing strategy simply does not align with its brand perception and consumer expectations. While Fronx may seem to be the bold leap Suzuki needs to boost margins—everyone else is doing it—it cannot price its way into profitability. Buyers have to be convinced. If Fronx is positioned carefully, it could become one of the more important additions to Suzuki’s lineup. If not, it is doomed to repeat history. The fact is, Suzuki’s greatest strength has been its mastery of small cars, especially in a market like Pakistan. This is where Suzuki can outshine any competitor by miles. Since FY23, no doubt the volumes that Alto has been wracking will have made Suzuki decent money. The company should fully embrace its position in the marketand double down. When pricing aligns with purchasing power, volumes add up. Instead of stretching upward and hoping that brand loyalty follows, Suzuki should ramp up capacity, scale and ruthless value engineering at the bottom end. Margins may be slim but volumes will compensate. In absence of strong public transport systems, small cars in Pakistan capture commercial commute as much as individual and household needs. For everything else, pricing has to become sharper. Fronx should be precisely priced as a bridge between hatchbacks/sedans and crossovers. Pakistan no longer lacks alternatives in the Rs4-7 million price range. It also does not lack astute buyers sensing that a company is a tad desperate. Suzuki should be careful not to the follow the herd; lest it disappears into it.