Suzuki will build 380,000 Fiat engines in India starting next January.
Suzuki is taking advantage of its divorce from Volkswagen to work more closely with Fiat.
The alliance is not recent: the two automakers started collaborating in 2003 and launched the Sedici/SX4 duo in 2006. In Europe, the SX4 is available with a Fiat-sourced 2.0 diesel and the two signed an agreement last June for the provision of a 1.6 diesel that will power the next generation of the SX4, which is currently under development.
Maruti-Suzuki, the Japanese automaker's joint-venture in India, builds approximately 280,000 1.3 JTD four-cylinder diesels a year under license from Fiat. 50,000 of them are sent to Suzuki's assembly plant in Hungary, and the rest stay in India.
A new deal inked between Suzuki and Fiat will bump up the annual number of Indian-built 1.3 JTDs to 380,000. This will allow Maruti-Suzuki to increase production of the Swift starting in January of 2012.
The Swift is one of the best-selling cars in its class in India. Gas prices have recently gone up and to combat a shortage of diesel models and a surplus of gasoline-powered models, the Japanese automaker had no choice but to raise the Swift's price.
India is one of Suzuki's largest market. According to The Indian Times, in 2010 almost every other passenger car sold had a Suzuki emblem on the front. The Japanese automaker owns 54.2% of the Maruti-Suzuki joint-venture.
1.'Maruti finalises deal...' view