Rumors are circulating that Maruti is looking to launch a car around the 1.5 lakh bracket within a year in response to the Tata Nano. This will be a 660cc car and even though it will cost more than the Nano, the market value and brand name should even things out. This is a key element Maruti has in its favour – a good history means you have won half the battle in terms of brand marketing.
This small car project is mainly being worked upon at the Suzuki headquarters in Hamamatsu in Japan, but the car will be manufactured in India. The project has been codenamed ‘Under A’ as it will be positioned under the A segment. Initially there were talks of a stripped-down version of the 800 as Maruti’s response to the Nano, Renault-Bajaj’s offering and Hyundai speculations of entering this segment. This seems promising as the profit margin on a Maruti 800 is around Rs 25,000 to 35,000 and selling a stripped-down version will be feasible. The Nano’s targets seem to be 5500 to 6000 units per month which is the same as the 800’s average sales figures at present. The Nano will definitely eat into this share to get close to its aspirations and Maruti will have to react and what better reaction than to go on the offensive (a new model) rather than a stripped down Maruti 800! Maruti seem to be very hush-hush about the project so the Nano better be prepared for an impending uppercut.
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