NEW DELHI, Nov 27: Hit by a severe slowdown in the automobile sector, Daewoo Motors India Ltd (DMIL) is set to record a turnover of Rs 800 crore this year, registering a sharp drop of 50 per cent on its projected sales.

The company achieved a turnover Rs 963 crore in 1996-97. Speaking at the inauguration of the newly commissioned facilities at Surajpur in Uttar Pradesh, Daewoo India's managing director SG Awasthi said "Phase I of the Rs 3,500 crore project, which will expand the current capacity from 72,000 to 1,50,000 cars per annum by 1999, has been completed".

The second phase, which will be delayed by about six months, would take up the installed capacity to 2,25,000 cars per year. The company has plans to enter all the segments of the market by 1999. ``Our first phase of expansion has already been delayed by about five months because of the slump in the market, so we have not fixed any specific time frame as we expect the second phase also to be delayed,'' Awasthi stated.

He said that the company would make a marginal investment of Rs 100 to 150 crore next year. It has already pumped in Rs 2,500 crore in the project, of a total investment of over Rs 3,500 crore.

Speaking about future plans, Awasthi said that the Cielo would not be phased out. Faced with a major slump in the automobile sector, DMIL registered a 20 per cent decline in sales during the first half of the current fiscal.

Sales have been very low and the mid-size segment of the market had a zero per cent (nil) growth till now.

Though figures from the automobile industry indicate that the company's share has sharply declined this year, Awasthi said, "We have maintained our market share of 22 per cent in 1997-98". The company sold 6,246 Cielo during April to October this year as against 10,000 Esteem, 6,198 Astra, 4,863 Escort and 1,170 Peugeot.

Product profile

Daewoo Motors has decided to launch the 33-seater and 26-seater buses next year. It also has plans to introduce trucks and is working on multi-utility vehicles. Daewoo has no plans to increase the capacity of 15,000 light commercial vehicles (LCVs) as it was not being utilised, Awasthi said. The LCVs would now roll out with the Daewoo brand name as the Korean company has replaced Toyota as the foreign partner, which was supplying around 15 per cent of the components.The company is going ahead with its plans to launch the small car codename M-100, next year.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.