Maruti Suzuki likely to go slow on Guj plant

Maruti Suzuki India on Thursday said it would be unable to sell as many cars as it did in FY11 and would likely delay commissioning of its third line at Manesar because of a slowing market.

While expressing optmisim that the current slowdown is in car sales is “short and temporary,” managing director Shinzo Nakanishi said his company now has the capacity to make 1.5 million cars and may not need to commission the C line (third one) at Manesar as per the orginal plan by March 2013.

This could also mean the country’s largest car maker will delay investments in its third manufacturing facility which is slated to come up in Mehsana, Gujarat.

Nakanishi did not confirm any delay on Mehsana, merely said a decision will be taken at the appropriate time.

Meanwhile, managing executive officer (sales & marketing) Mayank Pareek said the company sold 16% less cars till December vs the corresponding nine months of the previous fiscal and though some growth in the March quarter was expected, the current fiscal would close with sales lower than the last fiscal when it sold 1,271,005 vehicles, a growth of over 24% year on year.

Pareek also announced a price hike across the Maruti model range from next week on rupee depreciation.

The company also unveiled its compact SUV — XA Alpha. The rugged design of this vehicle has been inspired by the wrestling game and its launch will depend on consumer feedback at the Expo.

Around five Maruti engineers were involved in the project to develop the new concept along with the engineers of Suzuki, which took about 10 months.

Nakanishi said the SUV segment accounts for 14% of the total automobile market in India and since the company does not have any presence in the segment, it needs one to retain its leadership position.