Auto sector crisis: Maruti Suzuki to suspend production at Gurugram, Manesar plants in Haryana for two days

Early last month, Maruti Suzuki had reportedly decided to implement single shift system in all its plants including Manesar giving signals of a production cut.

FP Staff September 04, 2019 13:44:48 IST
Auto sector crisis: Maruti Suzuki to suspend production at Gurugram, Manesar plants in Haryana for two days
  • The company said it will halt manufacturing operations at the two facilities on 7 and 9 September

  • Reeling under severe slowdown, the auto major had reduced its production by 33.99% in August

  • In July, the automaker had cut its production by 25.15 percent to 1,33,625 units

With the crisis in the country's auto sector worsens due to falling sales, market leader Maruti Suzuki India (MSI) has announced to shut down its Gurugram and Manesar plants in Haryana for two days.

The company said it will halt manufacturing operations at the two manufacturing facilities on 7 and 9 September.

"Both days will be observed as no production days," MSI said in a statement.

Reeling under severe slowdown, the auto major had reduced its production by 33.99 percent in August, making it the seventh straight month of reduction.

The company produced a total of 1,11,370 units in August as against 1,68,725 units in the year-ago month. Passenger vehicles' production last month stood at 1,10,214 units as against 1,66,161 units in August 2018, a decline of 33.67 percent.

Auto sector crisis Maruti Suzuki to suspend production at Gurugram Manesar plants in Haryana for two days

Representational image. Reuters.

In July, the automaker had cut its production by 25.15 percent to 1,33,625 units.

On 1 September, the company had reported a 33 percent dip in total sales last month at 1,06,413 units as compared with 1,58,189 units in August 2018.

Early last month, Maruti Suzuki had reportedly decided to implement single shift system in all its plants including Manesar giving signals of a production cut in the wake of a persistent slump in the demand for vehicles.

Maruti Suzuki was expected to introduce one shift even at its Manesar plant in addition to Gurugram and Gujarat facilities which are operating below capacity.

The country's biggest carmaker had said that it had cut the number of its temporary workers to cope with a slowdown in auto sales, adding to the jobless problem in Asia’s third largest economy.

The vehicle industry, accounting for nearly half of India’s manufacturing output, is facing one of its worst slowdowns in nearly a decade, with vehicle sales falling rapidly. There is little sign of a swift revival.

The company had said in an email sent to Reuters it employed 18,845 temporary workers on average in the six months ended 30 June, down 6 percent or 1,181 from the same period last year. The company also said job cuts had accelerated since April.

In July, the company had said its domestic sales were down 36.3 percent at 98,210 units last month as compared to 1,54,150 units in July last year. It was in June 2017 that the company's sales had last fallen below 1 lakh units mark in a month.

On 15 August, it was reported that passenger vehicles production in India was down 13.18 percent in April-July this fiscal with top manufacturers such as Maruti Suzuki, Mahindra & Mahindra, Tata Motors, Ford, Toyota and Honda reducing output massively.

Hyundai Motor India Ltd (HMIL) and Volkswagen India were the only two main manufacturers which saw production grow marginally during the period, according to the latest data by the Society of Indian Automobile Manufacturers (SIAM).

Total Passenger vehicles (PV) production in the April-July period stood at 12,13,281 units as against 13,97,404 units in the same period last fiscal, down 13.18 percent, SIAM said.

With inputs from agencies

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