Maruti Udyog is all set to consolidate its position in the sports utility vehicle market by launching a new product priced between the Gypsy and the Grand Vitara.
It is also considering localising production of the Vitara in a bid to bring down its price. At present, the SUV is imported as a completely built unit and sells for over Rs 19 lakh.
Although it is the country's leading car producer, Maruti has been losing its market share in the SUV space. Its sales fell almost 25 per cent to 2,316 units in April-December 2006 from 3,007 units in the corresponding period of 2005.
At present, the on-road price of the Gypsy is around Rs 5.2 lakh, while the Vitara is available at Rs 19.76 lakh, leaving a huge gap in between for the auto giant to price the proposed SUV.
The variant, which is expected to be in the price band of Rs 9-12 lakh, will have a sizable local content to cut costs, which was the main reason for the Grand Vitara's high price. The Grand Vitara, imported as complete built units, invites a custom duty of 60 per cent.
"To bring down the total price of the Grant Vitara, which invites huge duties, we have plans to go in for local production.
We could opt for a new product between the Grand Vitara and the Gypsy with high local content to make it competitive and allow us to compete in the country's SUV market," Shinzo Nakanishi, chairman, Maruti Udyog, said.
Industry sources said Maruti was attempting to rejig its SUV portfolio to take on its competition. General Motors is planning to launch its Capitva SUV in the country's market sometime later this year.
President and managing director Rajiv Chabba said, "The market has big potential as the luxury segment is shifting towards these lifestyle products. We have marked Capitva for the Indian market, and it could be here anytime at the end of this year or early 2008."
Home-grown auto major Mahindra & Mahindra, which is the largest player in the SUV segment, will roll out a mild-hybrid technology version of its hugely successful Scorpio in 2008.
While Ford, which sells a sizable number of bulky SUV Endeavour, is coming out with its upgraded version, Honda Siel Car India has recently launched its all-new CRV in the domestic market.
Swedish auto maker Volvo, on its part, is planning to bring XC-90 model priced at Rs 50-60 lakh to India.