The order position for the Santro currently outweighs the company's output levels and the second shift is expected to significantly bring down the waiting period. As against orders of around 6,500 cars a month, Hyundai is now in a position to supply only around 4,600 units.

The company sold 4,634 Santros in June, as against 4,519 cars in May and 3,531 cars in April. ``We are overwhelmed by the tremendous customer response received by the Santro. It is our endeavour to continue providing greater value to our customers,'' said Hyundai Motor India managing director YS Kim.

The company is also readying for the launch of the new mid-sized car, codenamed LC. The pre-production prototypes for the three-box car are ready and it is slated for a launch in October with a 70 per cent indigenisation level.

``Wehad to lose a few customers as the current production level does not match the order position. With the second shift production starting later this month, we will be in a position to hike capacity by around 35 per cent,'' said Hyundai Motor India director (marketing & sales) BVR Subbu.

Santro has been among the highest selling cars in its category with cumulative sales in eight months (till June) totalling 30,331 units. Monthly sales currently hovers around 4,600 cars, which will increase after the second shift commences production. ``We can think of breaking even only after our monthly sales come close to 6,000 units for the full year and this may not be possible before 2001,'' Subbu said.

``The output levels will gradually increase as vendors in the supply chain also gear up to meet the production schedules. We can increase production, but vendors should also be in a position to meet the supply requirements,'' he added. The indigenisation level for the Santro car is currently around 85 percent.

Meanwhile, HMI is exploring the option of doubling its annual capacity to two lakh cars, an ambitious expansion programme which will require an investment of close to $400 million.

``Our immediate task is to raise output levels to 1.2 lakh cars per annum, and this should be achieved by 2001. The second phase expansion will be taken up after that,'' Subbu said.

Following increased demand for eco-friendly cars, Hyundai has already stepped up production of Euro-II compliant Santro cars. Orders for the eco-friendly model, which will cost the customer an additional Rs 6,000, currently account for around 20 per cent of the total sales of the company and is expected to touch 35 per cent in the coming months. Besides Delhi, Calcutta and Bangalore, Euro-II compliant Santros have caught the fancy of the customer even in smaller cities like Hyderabad, Pune and Amritsar, Subbu said.

The company has decided not to restrict the availability of its Euro-II cars to any specific region and will make themavailable across the country as an additional option.