Maruti Suzuki looks for technology tie-ups

Suzuki Motor Corporation (SMC), the promoter of Maruti Suzuki, will look at developing new technologies with component and raw material manufacturers. SMC wants the Indian arm to focus on developing more fuel-efficient vehicles and cater to the local demand.

T Suzuki, president and chief operating officer of SMC, denied any plan to tie up with Japanese peer Toyota. "Joint development of future technologies with component and raw material makers seems a more probable option," he said in an interaction with journalists here. Suzuki is here to attend the Auto Expo that begins from Wednesday.

Suzuki said it was becoming increasingly difficult for one company to work on all areas of technology and, therefore, joint work would be required. He said the company would focus on improving fuel efficiency of petrol and diesel engines.

Maruti will make efforts to minimise the cost increase that will come with the introduction of stringent regulatory norms related to emission and safety in India.

Going forward, Suzuki said he expected Maruti Suzuki to shoulder more responsibility in developing India-specific products focusing on high-end technology. This will lead to a lower royalty for the Japanese auto major. “The main responsibility of our Indian R&D is to develop suitable products for the Indian market. Maruti Suzuki will be shouldering more and more responsibility in this regard,” Suzuki said.

He said the firm was facing competition from the entry of other global auto majors in India. “Generating profit is also becoming relatively tougher. We have to develop more suitable products for the Indian market.”
Suzuki said there would be a threat for the company if SMC's Japanese rival Toyota were to increase stake in Daihatsu to 100 per cent, not only in India but also in other global markets and it would have to plan counter measures, which haven't been decided yet.

When pointed out that this could mean lesser royalty to SMC, Suzuki said the Japanese parent had been focusing on high-end technology products like hybrid and fuel cell vehicles, which could be used by Maruti, as India moves to stricter emission and safety norms in the future.

"But irrespective of changes in royalty, we will continue to invest in R&D in Maruti," Suzuki added. Maruti currently pays a royalty ranging from 5.6 to 6 per cent to Suzuki.

Maruti is investing Rs 2,500 crore to set up its R&D centre at Rohtak, which boasts of a test track among others, to enhance its production development capabilities.

The country’s largest car maker will be unveiling compact SUV Vitara Brezza on Wednesday at the Auto Expo, a global product in which Indian engineers have made major contribution towards design and development.

When asked about SMC's plans to avoid overdependence on India, Suzuki said the aim was to expand in Europe, Asia and other markets and increase profitability while at the same time ensuring that the Indian operations also continued to increase profitability.