Maruti Suzuki India Ltd (MSIL) is set to enter the light commercial vehicles (LCVs) segment in the next two years.

The new product will compete with LCVs already in the market such as Mahindra & Mahindra’s Genio and Maxximo Plus, Tata Motors’ Ace and Ashok Leyland’s Dost in the sub-one tonne to 1.25 tonne category. Prices of these vehicles range between Rs 3.5 lakh and Rs 6.50 lakh (ex-showroom).

On Saturday, MSIL said that its board of directors had given approval for the project last week. The board meeting was attended by Suzuki Motor Corp Chairman Osamu Suzuki.

Maruti is yet to decide on the name and price of the proposed vehicle.

“This will be for both domestic and export markets. We have seen demand for such LCVs growing in India and we think we can offer a superior product in the segment, as Suzuki has been doing so for years globally,” R.C. Bhargava, Chairman, MSIL, told reporters here.

He said growth in demand for such vehicles has been substantial over the last two years and the company’s engineers have been working on adapting the diesel engine (1.3L) that it has licensed from Fiat to be used in the proposed vehicle.

This will be a pure goods carrier and will be available in both diesel and compressed natural gas variants, he said.

Initially when Suzuki had entered India in 1982, it had planned to produce such vehicles for the Indian market. However, due to lack of demand, it had shelved the plan. Later, it had tried converting the Omni into a small truck (called Omni Pick-up) and had tested it in a few markets. But it did not meet with success.

The company may make the proposed new LCV a mass moving vehicle, like Mahindra’s Maxximo, Tata’s Ace Magic and Ashok Leyland’s Dost. Suzuki is already selling a similar vehicle called ‘Carry’ in other parts of the globe, including China, Indonesia and Pakistan (called Ravi).

Kenichi Ayukawa, Managing Director and Chief Executive Officer, MSIL, said the diesel engine for the LCV will be produced in India.

From the third facility

The new vehicle may be produced at the new (third) facility that MSIL is being setting up in Gujarat.

This unit is likely to become operational by 2015-16.

Bhargava said plans for entering the LCV segment is a part of diversifying MSIL’s portfolio based on the company’s strengths and also to de-risk its business, considering the slowdown now being witnessed in the car market.

On the slowdown in the market, he said the company expects sales to grow from September when Onam starts in south India.

“We expect sales to be good in the near future with good monsoon this year, festive season coming in and also elections early next year.

“We expect a growth of 4-6 per cent in our retail sales,” Bhargava added.

>ronendrasingh.s@thehindu.co.in

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