Maruti Suzuki will start supply of A Star to Nissan from February – March 2009. Way back in 2005, its parent company Suzuki Motor Corporation entered into a deal to supply 50,000 cars for Nissan. But given the current turmoil, the company indicated that it is still negotiating with Nissan about the pricing and volumes. Unconfirmed reports indicate that the sourcing will be for about 10,000 cars initially. These cars will be supplied to Nissan for sale in Europe.
Consequent to the 400 basis points cut in excise duty in early December 2008, car manufacturers have cut the prices by passing on sizeable portion of the benefit to customers. Maruti indicated that it hopes that the price cuts would boost sales over the next three months and the company may not have to cut production. That means, if the price cut does not improve sales, Maruti will cut production to control inventory build up.