Maruti will not launch XA Alpha in 2014: Reduces Fiat diesel engine supply
At the 2014 Delhi Auto Expo in February next year, Maruti is expected to show the Suzuki iV-4 Concept which premiered at the Frankfurt Motor Show earlier this year. iV-4 Concept is the next stage of development in the XA Alpha project, and the production version is expected to be shown in 2015 or at the 2016 Delhi Auto Expo in India.
Apart from this, following slow demand for diesel models in the Indian car market, several major auto companies are restricting their production facilities. Maruti Suzuki is among these auto makers who have announced their decision to reduce diesel engine supplies from Italian automakers Fiat. These supplies will be reduced by about 50% following decreased demand, but also due to the fact that the company plans to utilize their own plant for this purpose.
It was in 2011, that Maruti Suzuki had entered into a three year contract with Fiat India to source 1.3 liter diesel engines manufactured at the latter’s Ranjangaon plant. These engines were seen in Maruti Suzuki models such as the Swift, DZire and Ritz. During the period 2011-12, the company sourced a total of 1 lakh diesel engine units from Fiat while in the following year, demand came down considerable while in the current fiscal, Maruti Suzuki has decided on a 50% reduction in sourcing diesel engines.
Decreased demand follows prices of petrol and diesel coming practically on par with each other. Oil companies have been steadily hiking diesel prices that have decreased the lucrative gap between petrol and diesel variants. Petrol costs round 32% more than diesel as on date, while at one time, earlier this year, this price difference was at 47%. The decision to reduced dependence on Fiat is due to these factors while Maruti Suzuki has also shut down the third shift of their own diesel engine plant in Manesar and shelved expansion plans for their diesel engine plant in Gurgaon.