Aiming for double-digit growth in 2006: Maruti Udyog

He adds that he foresees other players entering the small car segment within the next couple of years.

Given your experience in this market for several years, what is the kind of elasticity and volumes that you expect to see, after these price cuts?
We have seen that whenever excise cuts take place, there is a step-up in growth, provided all other things remain same, and I am sure we will see it this time around too.

However, let me put it in proper perspective. This decision of price cuts is going to have a tremendous influence in the next couple of years, since I foresee other manufacturers to come into this segment. Players who have been sitting on the sidelines are expected to come here. Thus I feel, we will become a real strong base for the small car market.

Staying with the price cuts, what do you expect in the Swift and the diesel version when it gets launched later this year? Also, would you tweak any of your other models, to bring them under the ambit of small cars to effect cuts in them as well?
As far as the other models are concerned, they have to be considered with other models of other manufacturers. So I do not feel much can be done in this area as of now.

Second, the Swift diesel version, which would be 1.3 litres, would also come under the ambit of the new excise regime.

How much do you see the revenue increasing, after the price cuts, because the small car segment contributes more than 60 per cent of your revenue?
Well this year, growth has only been at 4-5 per cent in the market, so I feel we should try and aim for a double-digit growth.

Is there any more room for further price cuts, keeping the competitors in mind?
I feel the current price cuts, ranging from Rs12,000-Rs25,000 are very substantial by themselves, for all manufacturers.