Impact on vehicle production in Haryana, Gujarat plants in Nov: Maruti Suzuki

Maruti Suzuki India has informed the market that it is expecting an adverse impact on vehicle production in the month of November 2021 in both Haryana and its contract manufacturing company. This is owing to a supply constraint of electronic components due to the semiconductor shortage situation, Suzuki Motor Gujarat Private Limited (SMG) in Gujarat has informed.

"Though the situation is quite dynamic, it is currently estimated that the total vehicle production volume across both locations could be around 85% of normal production," it has informed.

The company's Chairman RC Bhargava earlier said that Maruti Suzuki India will launch electric vehicles in the country only by 2025 as demand for such vehicles at the moment is less and it would like to sell around 10,000 units a month whenever it enters the electric mobility space.

Addressing a virtual conference on the company's second-quarter earnings, he said under the current circumstances a lot of things in the EV ecosystem such as batteries, charging infrastructure and electric supply are done by other parties and therefore the costing is not in the hands of the company.

Also with fuel prices going up, car market leader Maruti Suzuki India is intensifying its focus on more CNG offerings of its models.

"Unfortunately, we will not feel happy if we can (sell) 300 or 400 or 500 or even 1,000 cars (a month). For some reason, we have gone too much higher volumes, and volumes in 100s and even 1,000s, are very good, but they leave us a little unexcited...So we have to see if I start selling EVs I would like to sell maybe 10,000 EVs in a month or something like that," Bhargava said.

He was responding to a query on the rising demand for EVs in India and the company's views on the segment, especially with competitors like Tata Motors receiving good responses for its EVs.

Elaborating, he asked,"If I'm selling 2 million cars a year, which I think it will be when things normalise, does it make sense to sell a car less than 1,00,000 a year out of 2 million?"

"I have to have a car which is more saleable, there has to be greater demand for the product. All Maruti products launched have had very significant demand," Bhargava asserted.

He, however, said the company has not given up on plans to enter electric mobility in India but the timeline would be decided by its parent Suzuki Motor Corporation.

Asked when could Maruti Suzuki launch its EV, he said,"If I have to give you an outside date it would be post 2025."

Stating that launching an EV would depend on market conditions, Bhargava said at present it is difficult to predict the pricing of electric vehicles, batteries, how the infrastructure is built up and "the costing is not at all in our hands".

The company had earlier in 2019 tested an electric vehicle based on its WagonR with plans to launch in 2020 but decided against a commercial launch for personal usage citing lack of infrastructure and government support.

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Asked if the government's production linked incentives (PLI) for EVs would encourage Maruti Suzuki to accelerate its EV plans, Bhargava said,"In any case our programme of launching an electric vehicle is not going to change because of the PLI scheme. I think a launch date or when you expect to launch the vehicle is something to be decided basically by Suzuki in Japan."

To a query on the rising petrol prices and its impact on demand for CNG vehicles, he said out of over 2 lakh current pending orders, majority are for CNG models.

Maruti Suzuki India Managing Director and CEO Kenichi Ayukawa said in order to meet the demand for CNG vehicles, the company will increase production for such vehicles while it is also working on plans to offer CNG options in more models in the next few years. 

(Inputs from PTI)