Analysts say that the move had become imperative as the company failed to push up sales despite a bouquet of seven models of the 1.2 litre Siena. Earlier this year, Fiat India had launched a stripped-down version of the model, but even that did not help the company much. Since its launch a year back, the company has sold only around 6,000 units of the Siena The company is, however, confident that its decision to reduce prices will finally make Siena "a force to reckon with and truly competitive vis-a-vis competition".

"Fiat has decided to pass on the benefits of its localisation programme to its customers. Continuously engaged in the development and localisation of its international products, Fiat India is happy to announce that it has succeeded in achieving much greater localised content for its Siena without compromising on quality," the company said in a release. Following the reduction in prices, the ex-showroom price of the petrol version of the Siena ELX will be Rs 5.91 lakh while its diesel version will sport a price tag of Rs 6.89 lakh. The petrol version of the Ford Ikon ZXi, on the other hand, is priced at Rs 6.45 lakh while the Hyundai Accent GLS (petrol) carries a tag of Rs 6.37 lakh.

A senior company official said that level of localisation for the Siena has almost doubled in the last 12 months with the present models having an indegenisation level of around 60 per cent. As compared to the Siena, sales of the Hyundai Accent and the Ford Ikon have picked up in recent months. In fact the Accent and the Ikon have been giving Maruti Esteem, which till recently was a leader in its segment, a run for its money. Last month, the sales of the Accent stood at 1,702 units as against 1,165 units of Maruti Esteem. The Ford, which delivered over 7,000 units of the Ikon since its launch in November last year, had bagged the top honours in its segment in March.

In a bid to boost sales, the company has been exploring various options including the launch of a high-powered 1.6 litre version of the Siena. The company will roll out the weekender version of the Siena very soon, while its world car -- Palio -- will be launched sometime next year.

The company is currently focussing on vendor development for Palio, which will have an indegenisation level of around 75 per cent at the time of its launch. "We have been working hard on increasing the localisation level of the Palio. Our aim is to launch the model with an indegenisation level of around 75 per cent," said a company official. Fiat India Automobiles, the holding company for the Italian car major, has recently hiked its stake in Fiat India, earlier known as Ind Auto. Fiat's stake in the joint venture company has increased from 76 per cent to 93 per cent while that of its local partners-the Doshis- has dropped from 24 per cent to around 7 per cent.