Maruti stops manufacturing petrol cars for 3 days, results in 8 per cent decrease in production

Thursday 07 June 2012, 11:32 AM by

Maruti Suzuki has toned down the production of its Alto, Wagon R, Eeco and A-Star since the inventory of the petrol cars has been piling up and the cars were available off the shelf. According to company officials, the production at two lines at its Gurgaon plant stayed shut for three days - May 25, 26 and June 2. Besides this, in the last week of June, the car maker is planning to shut down the production for a week-long maintenance spree.

A company official stated, “In all, we cut production of around 8,000 units across the three days. We currently have about 1.4 lac cars across ours and dealer inventories, most of which are the petrol variants.”

At present, operating from manufacturing plants at Gurgaon and Manesar plants, Maruti Suzuki has a monthly capacity of producing 1 lac cars over 25 working days. After the petrol prices were decontrolled by the central government in June 2010, the demand for the diesel-run cars has been on a northbound hike. With the massive Rs. 7 plus hike in the price of petrol, the difference between diesel and petrol prices was further widened. Now, the running cost of diesel cars in India is almost half of that of petrol cars at Rs. 2.5, as compared to Rs. 5.25 of the latter.

The official from Maruti also said, “Most of the industry is facing constraint in terms of diesel engine supply, while the petrol engine capacities are lying largely underutilised. At best, we can ask Fiat for more engines beyond our current agreement. We can't add our own diesel engine capacity as fast — our new plant will only come in by next year.”

Nearly 9,000 powertrain units will be sourced by the company from Fiat India every month, as per the agreement signed between two companies in January 2012. The capacity at the Gurgaon manufacturing unit will rise twofold to six lac units by 2014, riding on the back of a Rs. 1,700 crore investment sanctioned by the company in March 2012. For models like Swift, DZire, Ertiga and Ritz, which are also available with diesel options, company will produce only 20-30 per cent of the petrol variant. In future, if the supply of diesel engines increases, the production percent of the petrol variant will be further lowered.

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