Search the Internet          Tips  Sites: Finance, Investment

Maruti ups local-part usage to keep tab on prices

Diniar B Patel

Maruti Udyog Ltd (MUL) is increasing the level of indigenisation in all its models to keep spares competitively priced and, thus, maintain its sway over the domestic automobile industry. Maruti's most popular model, the 800, has an indigenisation level of 97 per cent, while in Baleno it stands at 35 per cent.

MUL, director (marketing and sales), Junzo Sugimori, who was in Calcutta to inaugurate Maruti's fourth dealership, set up at an investment of Rs 70 million, said, "The gearbox is one area where MUL is also looking at very seriously. We have already managed a 60 per cent indigenisation level in this component and this will grow as we move along."

The company in its bid to keep its market share, which is close to close 56 per cent, from slipping, has decided not to phase out any models.

"The market is growing at 5 to 10 per cent a year and as all our models fit snugly into the categories they have been earmarked for, be it in the small car segment or the luxury car segment, we see no reason to go in for a phase-out at the present juncture.

"Besides, market indications have pointed that despite sluggish figures, the small-car market is always buoyant," he said.

Though MUL's sales have dipped from 1300 cars a month to 1100 in the same period, Sugimori says the one-model-a-year concept still stands.

"As soon as the market is ready for a new look car, we will come out with one." The company that has spent close to Rs 30 billion in upgrading its facilities at Gurgaon, plans to bring in a host of Suzuki's models including the sports series and four-wheel drive variants as soon as it feels the market is ready for a wider choice.

Diesel is still a grey area for MUL and Sugimori says, the company has not earmarked major plans for increasing facilities for diesel engines, apart from the Zen Diesel, that has already been in the market for quite a while.

MUL though is very upbeat about its CNG variants, which it plans to push more aggressively. According to Sugimori, the car market has still got a long way to go in terms of saturation and there is plenty of room for more players. On its sliding market share, he said, "If there is no competition, there is no room for progress."

Powered by

ALSO READ:
The Rediff-Business Standard Special
The Budget 2001-2002 Special
Money
Business News

Tell us what you think of this report