The economic loss faced by India’s biggest car-making automobile industry has led to the downfall of the shares as much
as 3.72 per cent to Rs. 5,824.50 apiece. This has crooked the fate of the company leaving it with no other option but to announce no production days at its Gurugram
and Manesar plants on September 7th and 9th.
Initially in a regulatory filing to the Bombay Stock Exchange (BSE), the carmakers stated that Maruti Suzuki India would shut down the passenger vehicle manufacturing operations of these two plants on the same days since the company has seen a prolonged fall of shares in trading 2.5% lower at Rs.5, 900 in noon trade.
This has also led to cut down of lakhs of jobs in the auto sector across the nation while it goes through its worst slowdown in nearly a decade. The vehicles sales had been falling with a swift pace although it produces every second passenger vehicle sold in the country.
2018 vs 2019
The company on Sunday reported its one-third of decline in sales at 1, 06,413 units in the month of August whereas it sold off 1, 58,189 units last year in August. This news boiled up topics across the sector when the domestic sales became weak by 34.3% at 97,061 units last month while it managed to sell 1,47,700 units last year in August. Mini cars including Alto and WagonR sold 10,123 units and stands nowhere in comparison to 35, 895 selling of the same car last year in August. The sales from the last year have seen an inrush by 71.8%
The compact segment sales with models such as Swift, Celerio, Ignis, Baleno and Dzire, fell 23.9 per cent at 54,274 units as compared to 71,364 cars in August last year. Mid-sized sedan Ciaz sold around 1,596 units as compared to 7,002 units earlier that have led the company into the raging sea of crisis.
Employment cut down
The industry facing the crisis has however, battled to the rising inventory along with the slowing demand in the market that has cut 3000 contract jobs which had been employing more than 3.5 crore people directly and indirectly.
Maruti Suzuki India’s Chairperson RC Bhargava stated that new safety norms and higher taxes had been “added substantially” to the cost of manufacturing cars while delivering his take on this issue to the shareholders at the company’s annual general meeting.