Maruti Suzuki India flags drop in December output on chip crunch

Maruti Suzuki India said on Tuesday vehicle production at two of its manufacturing locations in the country could be around 80% to 85% of normal capacity in December due to the ongoing semiconductor shortages.

India’s biggest carmaker said in a filing to the stock exchanges that it expects the crunch`s adverse impact on total vehicle production volumes in the state of Haryana and at its contract manufacturing company in Gujarat.

Automakers globally have been forced to make sharp production cuts this year as supply chain disruptions and booming demand for consumer electronics have led to an acute shortage of semiconductors.

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Maruti’s latest production warning is the third one in less than six months, with the company flagging similar output falls in September and October.

The carmaker is also tackling a hit from rising input costs, and has announced price hikes across models several times this year. Earlier in the day, it increased the price of all non-cargo variants of its van EECO by 8,000 rupees ($106.51) after adding a passenger airbag.