Despite the three new launches planned for the next year, the company board has decided not to phase out the existing line-up, "as they are among the best in their price segment and it would be difficult to oust them."

Suzuki Motor Corporation of Japan, which control 50 per cent stake in MUL has agreed to provide technology for all the three models. "In fact, work has already started on developing these models, which would be creating new market segments."

Though the company has shortlisted Baleno and Wagon-R to be among the three new cars for the Indian market, itis still working towards finalising the third car, which is most likely to be a new small car, the sources added. It would be positioned between the existing 800cc model and the Zen model. The Wagon-R would be positioned below the Esteem but above the Zen, while the Baleno will be an expensive luxury car that will take on the might of Ford Escort and Opel Astra in the upper end of the luxury segment.

Regarding the likelihood of existing vehicles being phased out with the introduction of new cars, the sources said, "the existing cars still command a good market and it is not possible for any car manufacturer to address their price segments. So, it does not make good business sense to discontinue these models. They will continue to be made with slight upgradations."

MUL has already started working towards localising the components for the new vehicles. "Vendors are already working towards this end."

Though the company is trying hard to keep the prices of the new models at an affordable level, Maruti isfinding it hard to meet the base price of Maruti 800. "It is extremely tough meeting the Maruti 800 base-price. Even the small car would be priced over the 800," the sources added. The final price tags of all the four vehicles are presently being worked out. Meanwhile, MUL has already appointed Denso Corporation of Japan to provide the crucial fuel injection systems to be fitted into the existing vehicles post April 2000.This is in line with Maruti chairman Yoshio Saito's statement last year that no new models would be rolled out from the Maruti stables before the year 2000.

The company has already pulled down curtains on its plans to introduce a diesel version of its multi-utility vehicle -- Gypsy. However, it is still toying with the idea of sporting a diesel heart on the Esteem. The decision to this effect was primarily influenced by the cold response received by Maruti's only diesel offering on the Indian roads -- Zen-D.

"Besides, the cost add-ons for rolling out a diesel vehicle are too high and thewhole process is not economical and viable," the sources added.

Meanwhile, faced with poor sales volume, Maruti dealers are offering a Rs 60,000 rebate on the Zen-D as a desperate attempt to clear stocks. This comes close on the heels of a Rs 37,000 drop in the price tag of the vehicle by the company on December 30, 1998. The Zen Diesel is currently priced at Rs 418,185 (ex-showroom) in Delhi.

Besides, Maruti is working towards fitting compressed natural gas (CNG) kits on all its petrol-driven vehicles, including the `Maruti 800'.