Diesel Maruti next year

Country's largest car maker Maruti Udyog Ltd today said it would come out with a diesel variant of one of its existing models by the end of next year equipped with engine from its diesel plant in Maneshar in Haryana.

"The work on the plant has already started in the engine plant and we should start production from the plant by the end of next year, when we plan to come up with a diesel variant of one of our existing models," MUL Managing Director Jagdish Khattar said.

While sources said the diesel variant could be that of the company's latest offering Swift, Khattar, however, declined to comment on it.

"We will let you know at an appropriate time," he said after handing over a check of Rs 10.56 crore (Rs 105.6 million) to the government as dividend for the financial year 2004-05.

Khattar said MUL was keen to re-enter the diesel market, which was about 20 per cent of the overall car market in India.

"As of now we have only petrol cars, which is 80 per cent of the market, but the diesel segment has been growing and with the price differentials of diesel and petrol fuels still existing we need to have diesel cars," he said.

Maruti had in the past offered diesel variants of its Zen and Esteem models with engines sourced from Peugeot in France but discontinued due to high costs.

"The import of engines was costly and India being a price sensitive market we had to stop it as competitors have locally manufactured diesel engines," he said.

Khattar said the introduction of the diesel variants of its existing models with locally manufactured engines would make it more competitive in the market.

The diesel engine would be equipped with technology from Fiat licensed to Suzuki.

He also said the company would be introducing five new models in the next five years.

Maruti was also awarded on Thursday by the Japanese government for its role in promoting the country's brand in India. The award instituted by the ministry of economy, trade and industry (MITI), Japan is given to companies in Japan and overseas, which promote Japanese brands in overseas markets.

MUL is one of the only two companies outside Japan which have received the award this year.

The award was presented to Khattar by Japanese Ambassador to India Yasukuni Enoki on behalf of MITI.