Mumbai: Maruti Suzuki India Ltd, India's largest car manufacturer, will unveil its 'A-Star' compact car model in the local market in October and further ramp up its R&D on fuel-efficient cars.

The `A-Star', slated to be Maruti Suzuki's global small car brand, will use the `K' series engine and Maruti plans to equip its `Alto' model also with the 'K' series engines.

The global compact car A-Star uses the advanced K-series engine which is not only fuel-efficient but also complies with Euro-V emission norms, Maruti Suzuki India Ltd (MSIL) chairman RC Bhargava said. (View the Maruti A-Star picture gallery)

He said the demand for small, light-weight, fuel efficient cars would grow, adding the ''trend is clearly visible in global markets and is likely to enter India as well."

A-Star, he said, would be launched in India first and then introduced to the European and other markets. The company plans to export over 2,00,000 units of A-Star by 2010-11.

By next year Maruti Suzuki, which is 54.2 per cent owned by Japan's Suzuki Motor Corporation, hopes to launch the 'Splash' as well, he said.

''We are at an advantageous position because we have an expertise in designing small cars. With demand for small cars going up, we will quickly scale up our R&D capabilities to design cars that are best suited for the Indian market," Bhargava said.

Despite the prevailing high interest rates and a nine per cent drop in its vehicle sales last month, Maruti Suzuki said it was optimistic of sales volumes.

Maruti Suzuki sold 59,908 vehicles in August compared to 65,968 units in the same month in the year-ago period, a fall of nearly 9.2 per cent in sales - reflecting the single-largest decline in the past 2-½ years.

Sales of the company's small cars like Wagon-R, Zen and the Alto saw a dip in August, though the Swift and Swift Dzire provided some relief for the company.

The company expects sales to pick up in the festival season in October.

''The festive season has always been a good one for the industry as sales tend to go up and we expect the same to happen this year as well," said Bhargava.

He attributed the current dip in sales to some external factors like rise in crude oil prices, the sub-prime crisis and inflationary pressure.

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