NEW DELHI, JUNE 28: Leading car manufacturers today said they will not enter into a price war following the market leader Maruti Udyog's decision to cut prices of its various models as it was against their brand image and consumers' interest."We have no intention to cut prices of our small car Indica or offer any discount on the model," Tata Engineering general manager (commercial) and head of the passenger car division, Rajiv Dube told PTI adding the company did not want to involve itself in the process as "price-cutting is a never-ending game."Reacting to Maruti's recent announcement to cut prices of popular car models including Maruti-800, Omni and Wagon-R up to Rs 25,000, Hyundai Motor India executive director (marketing and sales) J H Kim said "there will not be any price reduction in case of our small car Santro.""Santro model is very well accepted in the market. We do not need any price cut or offer incentives to boost sales of the model," kim said. The price cut effected by Maruti Udyog was mainly due to its internal problems including poor response to the recent launch - 1100 cc car wagon-R, he said.Asked whether potential Santro buyers will switch over to Maruti products because of lower prices, Kim said "such a shift is not possible as people buy Santro because of its own features." Fiat India spokesperson said the company's models namely small car UNO and mid-sized car Siena were "not overpriced". Therefore, there was no question of a cut in prices."Fiat has decided against cut in prices because it is not good from the customers' point of view and brand image of the company," the spokesperson said. Fiat was not a "big-number player" in India, she said indicating the price cut would not help the company in getting any mileage.Daewoo Motors India spokesperson also ruled out any downward price revision of its small car `Matiz' saying the model was the best selling car of the Indian subsidiary of the Korean auto major.The company officials asserted that price cut announced by Maruti was due to its internal problems and Daewoo would not be affected by it.The 800 model is now considered by many to be jaded but its price is still a big draw. "It is crucial for Maruti to retain a sufficiently large price differential between its 800 model and the new models of these companies," RC Bhargava, Maruti's former managing director said. "Without it, there will be a switch away from its models," he said.Maruti managing director Jagdish Khattar, announcing the price cuts, said on Saturday that he expected the price reductions to "kickstart the market from its current uncertainty", much like it had at cut in its 800 cc model prices did in 1999.Indian car sales grew 55.8 per cent in fiscal 1999/2000 (April-March), and Maruti's own 24 per cent. But since then its sales have slowed. Its May sales of 27,533 units were 18.3 per cent lower than May 1999 while total car sales grew 18.4 per cent.
