Maruti Suzuki Seeks Solutions to Restore Output image

Maruti Suzuki looks for solutions to restore output of its most popular models after the strike at one of its plants.

In the following two or three weeks Maruti Suzuki has to decide whether to move production to its other plant in Gurgaon, after the riot on July 18th destroyed a big part of the Manesar facility, and ended with the death of a manager and a loss of about 40% of the company’s output including Swift hatchbacks and DZire sedans.

On July 28th the company reported a decreased profit for the fourth straight quarter, even before the riot, due to tough competition, weaker rupee and a drop in demand amid the struggling economic expansion. The company plans to boost output in Gurgaon, the only solution found to avoid a further drop in the market share and to bring back market growth.

“Getting Manesar back on stream is definitely on top of the agenda as the company is crippled at the moment,” said Deepesh Rathore, managing director at IHS Automotive in New Delhi. “But, that is easier said than done. Shifting production to Gurgaon is an option because only the Swift and DZire are really bringing in the numbers for Maruti.”