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Maruti to roll out diesel cars next year

Special Correspondent

The company has drawn an ambitious programme for new model launches in the next five years

NEW DELHI: Pinning high hopes on 25 million two-wheeler buyers of last five years to upgrade to cars, Maruti Udyog Ltd. on Friday said it was all geared to cater to them and would be rolling out diesel cars by 2006 end. The company also planned to make India an R&D hub outside Japan.

"The diesel car market has been growing in India in recent years. Suzuki Motor Corp, known for petrol engine technology, obtained diesel engine technology largely to meet the requirements of Indian customers," MUL Chairman S. Nakanishi told the company shareholders during the annual general meeting.

Referring to the approved plans of MUL, he said the diesel engine plant would come up by 2006-end and further strengthen the company's leadership position in passenger cars. The company was going ahead with its plans to make investments in a new car unit and an engine and transmission plant at Manesar in Haryana, besides fresh investments to upgrade the existing facilities.

While the existing manufacturing facilities are operating at close to peak capacity, Mr. Nakanishi said the new car plant would augment production and help meet the higher anticipated demand.

MUL, which now has production facilities to manufacture six lakh cars a year, reported a 19.7 per cent growth in sales at Rs. 11,353.80 crore in 2004-05 while the net profit jumped by 57.5 per cent to Rs. 853.60 crore.

The company had drawn an ambitious programme for new model launches in the next five years, he said.

Mr. Nakanishi reminded that Maruti was Suzuki's largest overseas operations. He said the parent company was assisting Maruti in improving productivity and reduce cost and was also collaborating in developing R&D capabilities.

On future plans, Mr. Nakanishi said Suzuki had plans to make India its R&D hub for Asia outside Japan.

While the company saw in the low penetration rate of cars in India presented a tremendous opportunity for growth, he said Suzuki and Maruti believed that India's car market had reached a point of inflexion from where it would achieve a sustained satisfactory growth in the medium term and much of the growth would come from the entry-level segment.

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