The top notch car maker in India, Maruti Suzuki Ltd, is doing well to retain its supremacy in car market. As a part of it benefit strategy the company has asked the component suppliers to reduce the price by 3% to make the savings upto Rs700 crore for the company. The company, after reaching the million mark, feels that the reduction will make the cost of each car reduced by Rs7000. The reduction, said the Chairman of the company, may compensate the fluctuation in foreign currency as well.
When the three fold impact- increase in raw materials, fluctuation in foreign currency and the non-reduction of cost for components- is not balanced, it will definitely have a say on the overall sale and the price of the vehicle. In addition, the company is burning the midnight oil to devise a more fuel-efficient engine to offer 20km per liter and emit less than 100kg/km carbon. The existing engines of Maruti cars have the mileage of less than 20kms and carbon level being more than 100kg (the lowest being 103kg). suzuki’s unique selling proposition is the fuel efficiency and the R&D wing of the company is geared up to devise such engines. The company is firm and keen on facing the global advancements regarding fuel efficiency and carbon emission.
The big car Kizashi, matching the likes of Honda Accent and Toyota Camry, is expected to be launched soon. The car, with 2.4 lit engine, is already on the roads of US and japan since last year. As of now, said Mr Bhargava, there won’t be any thought of relocating 800cc cars to meet the competition from Hyundai. Hereinafter, the basic model will be of 1000-cc to meet the expectation of the customers who need performance and value for money. The smaller engines pose a problem of facing the difficulty in emission norms. He further cleared that there is no relevancy on the agreement between Suzuki and Volkswagen for sharing the stakes. The Indian plants and facilities do not come under the purview of this stake, said the Chairman.