Maruti Suzuki has made an announcement to cut output due to the sluggish demand for four of its products. The company has cut production of Alto, WagonR, Estilo and Ritz cars this month as the market for these cars slowed down. The month of July saw a 16 percent drop in sales of cars in India which could be mainly attributed to the rising interest rates and fuel prices. Still, sales are predicted to pick up over the next month during the festive season.
The Maruti Suzuki Swift will be launched on the 17 th of August and has clocked record bookings already. The new car is could see huge demand and to cater to the ever growing orders, Maruti will concentrate on the production of the new Swift and the Dzire which are still in great demand.
“We are adjusting our production with market conditions. There are some models which are not moving fast enough given the sluggish demand. So, we have tweaked the production schedule to keep our inventory at the normal level,” Maruti Chairman RC Bhargava said on Friday.
The month of July was the slowest in terms of car sales. Also, Maruti Suzuki produced 17000 fewer cars compared to the same period a year back. The carmaker sold 75,300 vehicles in July compared with 100,857 units last year. The situation could stabilize over the next month as the festive season approaches. Also, Maruti has announced Rs 45,000 off on the A-Star hatchback. Which means, the company is also struggling to sell the A-Star which are lying around in warehouses for the past month or so.
It is clear that demand has shifted from the volume products like the Alto and the A-Star to premium hatchbacks like the Swift and the Dzire sedan. To balance this Maruti Suzuki has taken the decision to cut production of most of its volumes products. This move should also help bring down the initial waiting period for the new Maruti Suzuki Swift which could be in the range of 4 months after deliveries commence.
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