Suzuki aims to make India car unit production hub


MUMBAI, Dec 20 (Reuters) - Japan's Suzuki Motor Corp expects to make its Indian unit a major production hub and pursue an aggressive strategy to retain its dominant market share in India, the unit's new managing director said on Thursday.

Maruti Suzuki India Ltd , in which Suzuki owns 54.2 percent, earlier this month said it would make 150,000 units of the new A-Star hatchback in its Manesar plant in northern India from October 2008 and export them to Europe first.

The company, which is expanding its capacity to hit 1 million units by 2010, will launch other models that will upgrade consumers from its popular small cars such as the Alto and Zen Estillo, Shinzo Nakanishi said in e-mailed responses a day after taking over as managing director.

"We have an aggressive plan for new model launches," said Nakanishi, who has previously worked in China, Indonesia, Hungary, Pakistan and the Middle East.

"Suzuki is expanding its image from a maker of minicars and small cars to a company that offers the full range of models -- with the launch of models like Swift and SX4," he said, referring to the hatchback and the recently launched sedan.

Besides the Splash and A-Star, there were more in the pipeline, Nakanishi said, pointing out the company had launched five new models in the last two years alone.

For the first time, Maruti sold more cars in India than its parent in Japan during the first half of the fiscal year.

It is investing $1.75 billion in research and development and a similar amount in upgrading its plants and beefing up its vehicle line-up and dealer network in India to retain its market share of about 50 percent.

"Maruti Suzuki is ready to play a much bigger role in Suzuki's global operations," he said.

"Its manufacturing capability has reached a level where we want to make small cars exclusively in India for export to Europe."

Of the 3 million cars that Suzuki wants to sell worldwide by fiscal 2010, Maruti Suzuki will account for a third.

Competition is also growing, with third-ranked Tata Motors Ltd , as well as global rivals including Hyundai Motor Co , Toyota Motor Corp , Honda Motor Co and Volkswagen all hoping to increase sales.

Suzuki will also face a greater threat at the lower end from a $2,500 car that Tata Motors is scheduled to launch in 2008, and a $3,000 car that Renault aims to build with motorbike maker Bajaj Auto Ltd .

"Maruti Suzuki has also set ambitious targets for productivity, quality, safety and cost, in line with the 1 million target," said Nakanishi, who has been associated with Maruti from the time the company was set up in 1983 as a joint venture with the Indian government.

"Maruti Suzuki's R&D has shown tremendous potential through its contribution to the Swift and Concept A-Star (and) will strengthen in the next three to five years, both in terms of infrastructure and capability." (Reporting by Rina Chandran; Editing by Ranjit Gangadharan)



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