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Maruti Suzuki has been in a lot of troubles due to the labor unrest issues at its Manesar plant. Now all the issues at their plants and the high waiting periods of some of their cars have prompted Maruti Suzuki to look elsewhere for their production facilities.

Maruti Suzuki often loses out on a lot of sales due to the inadequate stock and they’re now looking to overcome this issue. A top Maruti Suzuki official has stated that the company shall set up a new production facility in Gujarat by 2015-16 and this decision will be taken at the company’s board meeting which is due late this month.

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S Y Siddiqui, COO of Maruti Suzuki said that, “The projected growth rate of 14% for the auto industry has slowed down to 4-5% in the current fiscal. This has created a bit of confusion about our Gujarat plans. It is likely to start in mid 2015-16. Our board meeting in January end will take a decision on it.

Maruti has drawn out an investment plan of Rs 4,000 crore for its next plant at Bechraji unit in Gujarat. The plant will have an annual production capacity of 2.5 lakh units every year. Maruti predicts that there will be a market demand of 45 lakh cars by 2016-17 in India and aiming to have a 40% share of that demand. Maruti Suzuki will be strengthening its partnership with Industrial Training Institutes to have a pool of skilled manpower.This will increase the employment opportunities in Gujarat to a huge extent.

Maruti Suzuki officials are of the opinion that the disparity in petrol and diesel has resulted in a slowdown in the sales of their cars, majority of which come from petrol cars. But the auto sector is expected to be back on track with the easing out of interest rates in the coming months. The RBI meeting due this month is expected to bring the interest rates down which will in turn contribute to a growth in the automotive sector. Maruti Suzuki also has a slew of upcoming launches and coupled with increased production and lower interest rates, it might very well be on track to gaining that 40% market share by 2016-17.

 

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Source: Economic Times

Richie Rich


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