Maruti Suzuki recently defenestrated the plans of rolling-out its 660cc 'K' cars in the Indian auto industry, as the company feels that the price of these cars does not befit the budget of majority of Indian buyers. The 'K' cars that will be seen in action during the auto expo heat in January 2012, will not be able to compete against Nano; the actual cause that brought the vehicles in India. India's largest car maker informed that it has scratched the launching of 660cc ‘K’ cars in the domestic market due to high prices.
“The K cars will not be launched as they will turn out to be too costly for India. The customers here usually associate the engine capacity with the price of a car while buying,” Maruti Suzuki Chairman R.C. Bhargava was quoted as saying.
As a matter of fact, in Japan, the ‘K’ cars are available to consumers after going through tax incentive policies, setting its price at one million yen or Rs. 6,00,000, Managing Director and Chief Executive Officer Shinzo Nakanishi said. The two ‘K’ cars, namely MR Wagon and Palette, will not hit the production stage directed for their sales in the Indian market. Rather they would be a shot in the arm for the Maruti's stall by being a part of its display at the mega auto show, confirmed Nakanishi.
“We want to ask customers what they would ideally want to pay for these cars. Normally, Indian market works on principle that smaller the engine, smaller the price. These cars are not like the Nano, but are much more sophisticated with a technology level much higher than that, featuring aluminium engines,” Bhargava stated further. It is important to note that the Nano’s entry-level version is available at a price of Rs. 1,36,000, while Maruti’s cheapest car is Maruti 800 that costs Rs. 1,98,000, let alone the price of 'K' cars.
According to Yaresh Kothari, an auto analyst at Angel Broking, Maruti has no strong reason to launch a car that squarely confronts Nano. “Maruti Suzuki doesn’t need a Nano competitor in its portfolio… They can look for another small car, but not a Nano competitor. Tata (Motors) has itself not been satisfied with Nano’s volumes,” he said.
The Nano could not live up to the company's expectations of ticking its gross average sales to 25,000 units a month, as it managed to sell-off just 6,000 units per month on average basis, this financial year. On the other hand, Maruti 800 continues to prove its mettle with the sales of about 2,500 units every month, in spite of being discontinued in 13 cities.
The two ‘K’ cars are capable of delivering an extraordinary mileage of as much as 30.2 kmpl that counts them among the most fuel efficient petrol cars world over. The Nano petrol also offers a decent fuel economy of 25 kmpl. Hyundai that dominates the second spot in the Indian industry expressed the desire to distance itself from the ‘basic’ car segment, represented by Nano and rather bring out a consummate car with additional features like Eon. General Motors also echoed Hyundai saying that Nano's non-commercial success is not convincing enough in order to tap the segment.
Thus, in the face of it, Maruti would be content over withdrawing its plans to launch 'K' cars in India as it may have turned out to be a fool's errand.
