Maruti Udyog is India’s largest car manufacturer but the company’s presence in the diesel engine segment has been negligible to date thanks to parent Suzuki’s lack of focus on diesel engines. This has allowed Tata Motors Indica Diesel model to become hugely successful. But things may be about to change.

Suzuki Motor Corporation, the parent company of Maruti Udyog Limited, has entered into a Product License Agreement with Fiat Auto and Adam Opel AG for the technology and manufacturing of Fiat’s 1.3 litre, Multijet diesel engine.

Maruti Udyog will manufacture the 1.3-litre diesel engines in India. The company has earmarked an investment of INR 3500 million (Euro 64 million) to set up a new facility to manufacture these engines. The new facility will have capacity to manufacture 100,000 diesel engines annually. It will begin production in 2006.

Maruti does offer diesel engine options in the Zen hatchback and the Esteem saloon. Both models are fitted with the Peugeot TUD 5 diesel engine currently. Even though demand is growing for diesels in India, Maruti has never aggressively marketed its diesel engine offerings and often customers have faced waiting lists. But with its own diesel engine plant coming up, the company is expected to aggressively venture into the segment. It is expected that the Zen hatchback, Esteem saloon and the Versa minivan will be offered with diesel engine options.

Deepesh Rathore / Tilak Swarup