Maruti to not hike its car prices

Despite the cost pressure on the Indian auto market, Maruti India has decided not to raise its car prices. The Indian czar for the small car segment will not increase the price of its car even when the raw materials used and other production cost have had a considerable hike of 20 to 30 per cent.

Maruti India sells three cars in every five cars in the small car segment in the Indian auto market. The company has chose not to increase the price of the range of cars it offers and maintain its hold in the market as the competitors plan to bring new cars and to enhance its service and sales network.

Shinzo Nakanishi, Managing director and Chief Executive Officer of MSIL said that the company does not wish to raise the price of its car and added that the company will curb the raw material price hike as much it can. The cost pressure is immense on the company. The market is moving fast with price hike and making the competition intense. Has also said that, the company has worry over its market share but has always come out of the pressure.

Nakanishi mentioned that company does not expect much from the overseas auto market with the decrease in demand in the European markets. As per him, Maruti will drift its focus and explore Australia, South America and South-East Asia markets.

Nakanishi also said that the company will launch one new model in one year, with facelifts and upgrading of its model will continue. Maruti is soon coming with a new manufacturing plant at Manesar, Haryana with a capacity of 250,000 units. This year Maruti expects to be coming with 1.23-1.25 millions units. He also mentioned that with the third unit, the company will have the additional 250,000 units every year.

The company has invested Rs 3,600 and more crore for enhancing the manufacturing capacity of the units with a total capacity to 1.7 million units. Maruti sells range of vehicles in the Indian auto markets such as Maruti Alto, Maruti 800, Maruti Omni, Maruti A-Star, Maruti Zen Estilo, Maruti SX4, Grand Vitara and more. But few models like Maruti Wagon R, Maruti Swift, Maruti Eeco and Maruti Dzire have great demand among the Indian buyers. The new facilities will help in balancing between demand and supply.

Tata Motors and General Motors gave the sign to raise the price of its range of products. From General Motors stable, it was announced that the German auto maker will revise the price by 2011 mid-January.

The raw materials such as grade steel, copper and rubber price have become dearer in the three quarters over last year's prices. The auto mobile parts suppliers are in constant pressure of price hike. In December, the Indian steel producers may increase the price by three to five per cent.

Toyota Motors which will launch the Toyota Etios on the 1st of December will be coming in two variants. The sedan will be launched first while the hatchback will follow it in three months.

Volkswagen Polo and Ford Figo, the hatchback cars which were recently introduced in the Indian auto market are expected to extend the dealership network to reach to more buyers. These compact cars are in great demand and have order bookings for three and more months.

50 per cent of the hatchback cars that run on Indian roads have diesel engine. Nissan Motor to take advantage of the choice of buyers introduced Nissan Micra diesel model in the beginning of this year.

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