"Small cars would continue to grow", says Chairman, Maruti Suzuki
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      "Small cars would continue to grow", says Chairman, Maruti Suzuki

      Sep 02, 2008
        "Small cars would continue to grow", says Chairman, Maruti Suzuki
       
      New Delhi, September 2nd, 2008: Car market leader Maruti Suzuki India Limited held its 27th Annual General Meeting here today.

      Addressing the shareholders Chairman Mr. RC Bhargava said emphatically, "The future belongs to small cars."

      Supporting his statement he said, "Worldwide there seems to be no respite from increasing fuel prices. In addition, the commodity prices have also shot up manifold. Therefore, the demand for small, light-weight, fuel efficient cars would grow and strengthen. This trend is clearly visible in global markets and is likely to enter India as well."

      Small is beautiful

      Exuding confidence on growth of small cars in the Indian sub-continent Chairman, MSIL said, "The Government has laid down policies that favour small cars. We are at an advantageous position because we have an expertise in designing small cars. With demand for small cars going up we will quickly scale up our R&D capabilities to design cars that are best suited for the Indian market."

      Big leap for R&D

      Mr. Bhargava informed the shareholders that Mr. Osamu Suzuki, Chairman and CEO of Suzuki Motor Corporation, had, in an interaction with the Maruti Suzuki Board, advised a scale-up of R&D capability at Maruti Suzuki.

      Mr. Bhargava said: "We target to increase the development work on the small engines (of upto 1200 cc) to 90 per cent in India and the rest in Suzuki, Japan". Currently MSIL contributes around 30 percent to the engine development work.

      Aim to reduce CO2 emission

      Mr. Bhargava said "The future belongs to cars that are fuel efficient and lower on CO2 emission. SMC would work on developing hybrid, electrical, multi-fuel engines that help increase fuel efficiency and enhance environment protection"

      Re-enter Europe

      The Chairman informed that the Company would re-enter the European market with yet another fuel-efficient, environment friendly, compact World Strategic Model. MSIL plans to exports over 200,000 units of this new model, A-Star, by 2010-11.

      Maruti Suzuki is investing to set up a dedicated car terminal at Mundra port in preparation for the sharp scale up in exports.

      The same car will be launched in the domestic market, to enhance presence in the competitive and growing A2 compact segment. This model will be commercially available in Indian market before it is sold internationally. The A Star will add on to the company¿s existing 6-model line-up in the small car segment.
      Additionally, in 2009, the company has already announced its plan to launch another World Strategic model, Splash (also in the A2 segment).

      Investment

      The Company has committed to invest Rs 9,000 Crore by 2010 in India operations. The world class plant at Manesar (part of this investment) is ready to reach its peak production level of 300,000 units next month. In addition, the diesel facility and the suppliers' park at Manesar which were commissioned last fiscal are progressively building capacities, as per plan. The company will soon commence operations at the new engine series plant at Gurgaon

      On further investment the Chairman remarked, "Maruti Suzuki's great strengths is that we have internal resources to finance both R&D expansion as well as capital investments. The higher interest rates, and the risk of making large borrowings to finance capital costs, will not affect us."