Maruti Suzuki Signs Car Terminal Agreement With Mundra Port

Maruti Suzuki India Ltd, the Indian subsidiary of Japan's Suzuki Motor Corp, said it has signed an agreement with Mundra Port and Special Economic Zone Ltd (MPSEZL) for a mega car terminal at Mundra, in the western state of Gujarat.

Initially, the company will invest 400 mln rupees while MPSEZL will pump in 600 mln, it said in a regulatory filing.

The new terminal, where cars are parked and loaded onto carrier ships for export, is expected to be operational by December, and Maruti Suzuki will begin shipping from the Mundra Port by January next year.

Chief executive, S Nakanishi, said the initiative will help fill the gap between the company's export ambitions and 'on the ground' infrastructure support.

The country's biggest carmaker exported 50,000 units in fiscal 2007-08, a rise of 28 pct year-on-year, by using the port facilities in Mumbai. It expects to continue shipping from Mumbai as well, keeping in view its increasing export volumes.

At 01.55 pm local time, Maruti Suzuki shares were 2.77 pct lower at 784.80 rupees on the Bombay Stock Exchange, while the benchmark Sensex was 2.14 pct down at 17,689.31.

No Car Below Maruti 800: Maruti Suzuki

Maruti Suzuki India today denied reports of plans to launch a small car with a 660cc engine positioned below the Maruti 800 and priced at Rs 1.5 lakh.

According to a release issued by Maruti to the BSE today, "as announced earlier, the company has no plans to launch a car like the one mentioned in the report. The Project "Under A" mentioned in the report refers perhaps to the "A Under" - the earlier code name for the A-Star model.

"Maruti offered the first People's Car, Maruti 800, about 24 years ago. Since then, India's middle class and Maruti's customers have grown in every facet of their lives. Their incomes have gone up significantly. Their lifestyles have improved in ways that were hard to imagine a decade ago. Within the space of a generation, the "People" who bought "People's Cars" have transformed almost beyond recognition.

"With that, expectations from a car have evolved considerably. Car customers now generally settle for nothing less than contemporary styling, international quality and latest features that enhance their safety and convenience while expecting performance and fuel efficiency like their parents did before them.

"These changing preferences are reflected in the sales data for existing segments in the car market: models and variants that promise only economy and low acquisition cost are increasingly losing out to models and variants that are rich in features and style. The company find this trend holds true across segments including among entry level cars.

"In experience, the company's entry level car customers nurture a high degree of aspiration, both in new cars as well as pre-owned. They want more from their cars in terms of features, performance, safety and versatility.

"Maruti Suzuki has been able to notice and understand this transformation largely due to its close relationship with customers throughout the period of their car ownership.

"Suzuki and Maruti's approach of "World Strategic Models", which includes cars like Swift, SX4 and Grand Vitara, ensures that Indian customers get international quality and style at the same time as customers in markets like Europe and Japan. The success of these cars in the market has endorsed our view, and the company want to pursue this strategy with greater vigour in future.

"In future, the company plans to launch world strategic models like Splash and A-Star as part of the same conscious efforts to offer international quality and design to Indian customers at an attractive price.

"The company's view is that as Indian middle class families move up in life, they should continue to receive a range of cars from Maruti Suzuki that offer superior quality, international design and rich features. That is where its focus will lie.

"Maruti Suzuki reiterates that it has no plans of developing or offering a new car below the Maruti 800."

Source: http://www.business-standard.com/