Maruti Suzuki repeats: no car smaller than 800

MUMBAI (Reuters) - Maruti Suzuki India Ltd, the country's top car maker, reiterated on Tuesday it will not make a car smaller than the mini 800 to take on competition, and will meet the changing demands of consumers with its new line-up.

Rival Tata Motors' ultra cheap Nano car, scheduled for roll-out later this year, is expected to make motorbike users upgrade faster and to steal share from other car makers.

That has given rise to speculation that Maruti and No. 2 car maker Hyundai Motor Co will launch new low-cost cars or cut the prices of their existing entry-level models, the 800 and the Santro. The Maruti 800 was first launched in 1984.

A report in the Times of India on Tuesday said Maruti, 54.2 percent owned by Suzuki Motor Corp, was preparing to build a small car with a 660 cc engine and priced at 150,000 rupees to take on the cheaper Nano.

Maruti denied the report.

"The company has no plans whatsoever of developing or offering a car in the segment below the Maruti 800," it said in a statement, reiterating what its country head said in January.

"Changing (consumer) preferences are reflected in the sales data: models and variants that promise only economy and low acquisition cost are increasingly losing out to models and variants that are rich in features and style," it said.

But other car makers are eyeing the low-cost segment. The alliance of Renault and Nissan Motor Co is studying a $3,000 car with motorbike maker Bajaj Auto.

Volkswagen and Toyota Motor Co have also expressed interest in a low-cost model for emerging markets.