Maruti Suzuki India Ltd.

Fiat and Suzuki Motor Corporation have inked an agreement to supply 1 lakh diesel engines to Maruti Suzuki India, which will help the country's largest carmaker to manufacture more engines, and thereby prune the rapidly growing waiting list. The two auto giants agreed to supply Fiat's 1.3 litre-multijet engine - licensed by Fiat India Automobile, which is a joint venture between Fiat and Tata Motors- to Suzuki's Indian arm, Maruti Suzuki India. The JV company will supply up to 100,000 engines annually to Maruti beginning January this year for a period of three years. The production of multijet 1.3 litre engines for Maruti Suzuki will begin in the fourth week of January at Fiat India Auto's Ranjangaon plant in Pune, and supplies will resume at the earliest. The supply of these engines got stuck on pricing issues.

This development will bring a relief to Maruti, which has over 1,10,000 customers waiting in the queue to take delivery of its largest selling car, Swift. The company is gearing up to increase production at the Manesar plant to deliver more diesel cars. Starting January, Suzuki Powertrain - a subsidiary of Maruti Suzuki - will start producing 5,000 more units a month, and the extra 8,000 engines from Fiat's Ranjangaon plant would mean, there will be additional 13,000 more diesel engines at the disposal of Maruti Suzuki, which would help the carmaker clear some of its backlog.