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When the Indian car industry opened its doors to new players, Maruti Udyog Ltd, which had, till then enjoyed an enviable position in the market was suddenly faced with severe market erosion. This case study looks at the various strategies MUL adopted to regain its place in the market - particularly its price-reduction strategies and the widening of its product range. The case also looks at the reactions and moves of other players in the industry, viz. Hyundai, Daewoo, Telco etc. The case is so structured as to induce students to think about the merits and demerits of MUL''s moves, particularly in view of the prevailing price- dynamics in the car market. For instance, the students should essentially be able to understand the mechanics of price-reduction strategies and the necessity given the competitive scenario. The tutor can use the case discussion to drive home the importance of pricing as a part of the marketing mix. At the end of the case discussion, the students should have an understanding of the following issues: (1) the upheaval in the Indian small-car segment in the late 1990s and the emergence of various players; (2) the importance of pricing strategies in this segment; (3) the factors that made MUL opt for price-reduction and its after-effects; and (4) merits and demerits of price-reduction as a strategic pricing tool. The case is intended for MBA/PGDBM level students as part of their Marketing Fundamentals curriculum and marketing electives, viz., Strategic Marketing etc.