Maruti Udyog Ltd (MUL) yesterday launched its much-awaited new small car, Alto, in two versions -- 796cc and 1061cc -- priced at Rs 2.99 lakh and Rs 3.65 lakh, ex-showroom Delhi.
With the launch of Alto, Maruti's showrooms across the country will offer 16 versions of Maruti 800, Zen, Wagon R and Alto. These range from Rs 2.12 lakh, for a Euro-II compliant Maruti 800, standard version, to Rs 4.96 lakh for a Wagon R automatic version.
According to Jagdish Khattar, managing director, "The company's future depends on Alto." During the current financial year, MUL hopes to sell between 25,000 and 30,000 units of the Alto, Rohtash Mal, chief general manager said.
According to sources in the company, MUL is taking a hit of Rs 25,000 to Rs 30,000 on each car which translates into a hit of Rs 75 crore to Rs 90 crore on the company's bottomline.
However, the burden will be met to a large extent through a planned increase in the price of Maruti 800, Omni and Zen models very soon. When queried how long the existing prices of MUL will be maintained Khattar said: "They are committed to these existing prices till September 30th".
Company executives said the Alto has an indigenisation level of 70 per cent, and is targeted to go up to 90 per cent in the next 16-18 months. The model will break even at an indigenisation level of 85 per cent, the sources said.
Competitors have mixed responses to the car launch. An industry source said that while Alto will not affect Hyundai Santro, it will wipe out Daewoo Matiz due to its aggressive pricing. Young-Chang Kim, managing director and CEO, Daewoo Motors India Ltd, however, said: "We are confident about our product. We sell 80,000 units of Matiz in western Europe, while Suzuki sells only 15,000 Alto there."
MUL is raising another Rs 400 crore loan through a debenture issue of a five-six year tenure to meet finance the launch of the model and other upgradations. MUL won't exercise the Rs 100-crore commercial paper programme planned earlier.
Company executives however say that through these measures the company is expected to be in the black though profitability might fall further.
The 800cc version -- Alto LX -- comes with an air-conditioner (with heater), remote fuel lid opener, a tripmeter, rear door child lock and tinted glasses. Alto VX 1.1 is a fully-loaded version with features like rear wipers, power windows, tachometer and central locking. The car would be available across the country from September 29.
The 796cc version Alto LX and 1061cc Alto VX are powered by 12 valve Euro-II engines and deliver 45 brake horse power (bhp) and 62 bhp. The car is available in seven colours -- ruby red, pacifique green, milky white, cool silver, atlantic blue, silicon gold and coral beige.
Alto is the fourth product to be launched by MUL over the last 10 months. The company has plans to introduce one new model every year.
