Maruti Suzuki India Ltd’s Manesar plant, which has faced labour unrest since June, is preparing to roll out a new compact sedan to take advantage of lower tax rates on models that are shorter than 4 metres in length.
The new sedan—known as Swift 3.99 among workers—is being developed at an investment of at least Rs.500 crore and may primarily be targeted at markets outside India as people in Europe and Latin America prefer smaller, fuel-efficient cars as the slowdown in the global economy reduces incomes. There were at least 20 such cars including a few left-hand drives meant for overseas markets parked inside the plant. The photographer was prevented from taking pictures of the car.
“We have started the trial runs,” said an official at the plant, who did not want to be named and refused to share more details. A formal name for the car has not been decided.
“If the trial runs have started, then it is quite possible that we may see the car much before the Auto Expo,” said Shapur Kotwal, deputy editor, Autocar India magazine
Maruti Suzuki is planning to introduce a shorter version of the Dzire, which is 4.16m long, to avail the benefit of lower excise tax, a move that will give it room to be more price-competitive. The existing Dzire puts it in the category of a big car, attracting excise duty of 22% compared with 10% for a car that is less than four metres long. The current ex-showroom price of the Dzire in Delhi is Rs.4.94 lakh. However, the compact Dzire is likely to be priced around Rs.4.49 lakh.
In 2008, Tata Motors was the first to take advantage of the tax incentive for smaller cars by introducing the Indigo CS model. The car maker chopped the boot off the Indigo, dropped its length to 3.9m, and passed on some of the benefit of the lower tax to customers.
As a result, Tata Indigo CS became 50,000 cheaper as compared to previous sedan. On the similar lines, Maruti Suzuki wants to capitalize upon the benefits and launch a car which is cheaper than its competitors in the market. At present, we have Toyota Etios and Mahindra Verito which are sub 5 Lac sedans and thus can be a threat to Maruti Suzuki swift Dzire. Meanwhile, Nissan launched its sedan Sunny priced at Rs 5.78 Lac, base model ex-showroom price. For details of the car, Click here
For comparison between Suzuki SX4 and Nissan Sunny, click here
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