Maruti Suzuki and Hyundai to ramp up diesel engine production

Many Indian auto manufacturers are mulling to step up the investments to make more diesel cars in order to stay competitive in the current diesel-favored market. The demand for diesel cars that has been triggered by a series of high interest rates and the steep and steady rise in petrol prices has compelled India's largest automaker, Maruti Suzuki and Hyundai Motor India to infuse more investments in developing diesel-powered cars. 

Also, a tax on diesel cars was anticipated in the Budget 2012-13 and therefore most auto companies had put their diesel engine production plans on the back burner. However, much to the auto industry's relief the Finance Minister took no such step during the Budget 2012-13 and most of the company’s are now mulling to ramp up their respective diesel engine production. 

"Diesel is indeed an answer and we would soon finalize the strategy for a new plant." Maruti Suzuki India chairman RC Bhargava said. Maruti Suzuki has already anticipated the market trend much earlier in 2009 and hence started making diesel engines. Now, the company is mulling to add more capacity and in it's endeavor the Indian automaker has already inked a deal with the Italian carmaker Fiat SpA to source three-lakh diesel engines. Maruti is also in process of adding a second diesel engine plant at its Gurgaon facility.

Hyundai, world's fifth largest carmaker, which pirated a wholly-owned subsidiary in India, is in the final stage of rolling out a Rs 400 crore greenfield plant that will make 1.5 lakh diesel engine every year. The new diesel engines will find home in the Hyndai i10 hatchback and the company's small offering, the Hyundai Eon. "Diesel is the bigger motivator to buy new cars in the current scenario." Arvind Saxena, Hyundai Motor India, director of marketing and sales said. Currently, Hyundai sells diesel models for its i20 hatchback and other bigger cars, the diesel engine of which are imported from South Korea.