Maruti Udyog [Get Quote] on Wednesday launched Euro III-compliant versions of compact cars Zen and WagonR and Baleno sedan, sporting higher price tags, and plans to increase steel procurement from the domestic market.

The new Zen and WagonR variants would cost Rs 10,000 more while the price of the new 'Baleno' would go up by Rs 15,000, Maruti Udyog managing director Jagdish Khattar said.

"Domestic steel offers us competitive edge as prices are low compared to price of steel produced by overseas companies. Next fiscal, a number of contracts for steel procurement will be renewed and there will be preference for Indian players," he said.

At present, Maruti uses 30-35 per cent of steel produced in India and plans to increase it to 50 per cent next fiscal. Maruti, which is 54.2 per cent owned by Suzuki Motor Corp. of Japan will launch more Euro III-compliant variants of 11 cars in a phased manner over the next few months.

He said the company would shortly announce price increase on Euro II and yet-to-be launched Euro III versions of entry-level car Maruti800.

Asked whether the price increase, which is partly on account of new emission norms, would affect customer demand, Khattar said carmakers were in no position to control prices.

The launch of new models by Maruti is in line with the stipulated deadline of making Euro-III norms mandatory in 11 big cities from April 1, 2005.

Maruti raised prices on all models except Maruti 800, citing rise in input costs on Wednesday. The price increase was on all the existing Euro II models.