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K. Giriprakash

Plans to export Swift from Hungarian plant to other European countries

Bangalore , Sept. 14

Maruti Udyog has stopped exports of its largest selling car, Alto to Europe after its parent, Suzuki starting to export Swift from its Hungarian plant to other European countries.

Sources in Maruti told Business Line that steady decline in exports was mainly because Alto constituted nearly 80 per cent of its total exports. Exports fell 17 per cent in the April-August 2006 period to 13,195 units only. Maruti is now trying to increase exports to non-European countries in West Asia, Latin America and even to Sri Lanka.

The decision to source Swift from the Hungarian plant was taken because of its proximity to other European countries. Apart from Hungary, Swift is manufactured in India, China and Japan. Maruti is now looking at replacing Alto with another compact car, which will be exclusively for exports.

Early this year, Suzuki and Nissan announced a deal which envisages supply of 50,000 cars of a new small car by Maruti Udyog from April 1, 2008, which will be exported to Europe under the Nissan brand.

The new car will be manufactured at Manesar in Haryana where production will commence from December. Maruti will on its own export 1 lakh units of the new small car mainly to Europe and around 50,000 vehicles will be sold domestically.

The total exports by 2009 are expected to go up to around 4 lakh cars annually. Sources said that because of higher fuel prices, customers in the European countries are looking at fuel-efficient small cars and, hence, there has been a major demand for such cars.

Maruti has already announced that around Rs 4,000 crore will be invested in its existing plant in Gurgoan and around Rs 5,000 crore will be invested in a diesel engine plant and production of a new small car.

The new plant will produce 1 lakh Swift cars, and 2 lakh new small cars.

Maruti expects to sell 6.3 lakh cars during the current financial year compared with 5.27 lakh cars in the previous year. During the same year, it exported 35,000 cars.

On Thursday Maruti Udyog's share prices were trading at Rs on the BSE.

More Stories on : Cars | Performance | Exports & Imports | Maruti Udyog Ltd

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