While Maruti Udyog and Hyundai Motors have announced plans for a steep price hike due to the steady increases in raw material costs, Tata Motors has announced a steep price cut for the Safari - by as much as Rs1.9 lakh, thanks to the economies in sourcing that it has built up.

The ex-showroom (Delhi) prices of its new variants, the entry-level TCIC diesel is Rs6.4 lakh, the common rail diesel engine powered Dicor is Rs6.99 lakh and the multi-point fuel injection petrol version is Rs7.99 lakh.

On the other hand, Mahindra & Mahindra's Scorpio is priced between Rs7.06 and Rs8.18 lakh while General Motors' Tavera is priced in the range of Rs5.98 and Rs9.25 lakh.

Tata Motor has managed to bring down the prices of the Safari due to its aggressive cost-reduction plan. The company hopes to increase its volumes, substantially, having sold 4,692 units in 2005-06, a 48-per cent increase over the previous year.

At the same time its finance arm, Tata Motorfinance (TMF), has begun disbursement of car loans to customers of Fiat India. This is for the first time the company is financing non-Tata products.

Earlier Tata Motors had decided to sell Fiat cars through its dealers, following the joint marketing agreement signed by both companies a few month earlier. However, the credit will be restricted to the customers of Fiat India and not the company's dealers.

Tata Motors' dealers have started selling Fiat cars in select metros such as Delhi, Chennai, Kolkata and Bangalore from March.

Tata Motors may also sell Fiat cars in non-metros from next year. Only three Fiat dealerships across the country will sell Tata cars intially. Recently, Tata Motors sales representative underwent training at Fiat to understand the sales and servicing strategy.