Marutis 800cc diesel engine to power Celerio, Wagon-R

Written by Rachit Vats | Mumbai | Updated: Jul 22 2014, 13:52pm hrs
MarutiMaruti Suzuki may be a late entrant to the diesel segment but is now playing catch-up.
The countrys largest carmaker Maruti Suzuki may be a late entrant to the diesel segment but is now playing catch-up. The automaker is working on rolling out a new 800cc diesel engine, which along with the recently-launched Celerio will also power its compact car Wagon-R. The move is expected to bring incremental volumes for the company and help it maintain a headstart in volume and market share as its Japanese rival Nissan is likely to make rapid inroads with its Datsun brand.

According to sources, the recently-launched Celerio will be the first car to have a smaller diesel engine fitted on it, followed by Wagon-R. Both models currently come with a 998 cc, 3-cylinder engine delivering a power of 67 bhp and a torque of 9.1 kgm. The company neither confirmed nor denied the development. Maruti Suzuki does not give guidance or comments on future models or technologies, said a Maruti Suzuki spokesperson in an email response.

The carmaker is, however committed towards ramping up its diesel engine presence. We have to take, a medium to long-term view on fuel options and we are convinced that even if there is a withdrawal of subsidy on diesel, it will remain a promising fuel for the auto industry, said KD Singh, vice-president, corporate, Maruti Suzuki in an analyst call in late April this year.

The carmaker is known to be setting up a new diesel engine production line with an investment of Rs 1,000 crore at its Gurgaon plant that will have a capacity of 1.5 lakh units a year. The production line will help the carmaker deliver its new series of self-developed diesel engines, making a debut with the 800cc diesel engine in the initial phase. At present, the carmaker has a total capacity of 4.5 lakh diesel engines on an annual basis.

Maruti will be able to offer a unique value proposition with the introduction of diesel engine powered Wagon-R. It will be a strong differentiator against competitors and help sustain volumes. The carmaker could see a volume boost of as much as 15% for Wagon-R with the inclusion of diesel-powered engines in the space, said Puneet Gupta, associate director, IHS Automotive.

In the mini compact space the carmaker sold 47,618 vehicles in June, which is a rise of 52% compared with the year-ago period.

Having a diesel engine will further improve Marutis volume and market share in the small car space. As of now the share of diesel in the entry-level small car segment is small and share of diesel will rise as more product options become available and Maruti is scaling up diesel engine capacity, said Yashesh Mukhi, auto analyst at Morgan Stanley.

Maruti Suzuki sold 10,53,689 units in FY14, a growth of 0.25% compared with the year-ago period. The passenger vehicles industry declined 6% to 2,503,685 vehicles in FY14. In June this year, the carmaker sold 1,00,964 vehicles in the domestic market, a jump of 31% as compared with a year ago.