Maruti Suzuki Explains Why It’s Cutting Production In India

Maruti Suzuki is India’s largest car manufacturer. The car industry has been going through a slowdown, and it looks like even the largest car manufacturer is struggling. Maruti Suzuki has now confirmed that they are adjusting their production to ease inventories with dealers. The manufacturer decided to make this adjustment after the market witnessed slower-than-expected demand for passenger vehicles in the first quarter of 2024-25.

Suzuki Motor Corporation (SMC) said, “We are currently adjusting production to reduce market stock and are closely monitoring demand trends. India will be in a critical period with the upcoming festival season, so we will closely monitor demand trends.” It is not just Maruti Suzuki; the whole Indian auto industry is facing this slowdown, and this has triggered concerns among the major players.

In connection with this matter, the Federation of Automobile Dealers Associations (FADA) has written two letters to the Society of Indian Automobile Manufacturers (SIAM) in the last couple of months. According to reports, automobile dealers across the country are sitting with approximately 730,000 unsold vehicles.

SIAM shared an estimated number of 400,000 units. Car sales are usually slow during the first quarter. Because of this slowdown, we saw several car manufacturers come forward with great discounts and offers on their models. However, this year it has been slower than expected, especially due to the Lok Sabha election and adverse weather, including heavy rain and heatwaves.

Responding to Business Standard, Partho Banerjee, Head of Sales & Marketing, said their inventory stands at 38 days. “We do not intend to reduce it further as we consider our stock level ideal for the upcoming festival season, including Onam in Kerala, Ganesh Chaturthi in Maharashtra, and Navratri, followed by Diwali in North India in October 2024.”

After the first quarter, sales usually pick up and perform well for the rest of the year. This year, manufacturers have yet to see such a trend. They are now aiming at the festive season that starts in late August this year.

Suzuki Motor Corporation (SMC) told Business Standard, “As inventories have increased, we are making adjustments… This year, the festival season starts in late August, a little earlier than the previous year, and the higher the demand, the volume for the whole period becomes bigger.”

Maruti Suzuki holds 40 percent of the share in the Indian car market. The manufacturer saw a 7.4 percent year-on-year production increase in the first quarter of 2024-25, but the sales increase was only 1.2 percent. With the launch of new products and better discounts in the market, sales are likely to pick up and are expected to be in full swing by the time the peak festive season is reached.

Maruti Suzuki’s only 4×4 SUV in the Indian market, the Jimny, is currently being offered with excellent discounts. For the month of August, the Jimny Alpha variant offers benefits of up to Rs 2.5 lakh when purchased through Maruti Suzuki Smart Finance (MSSF); the Jimny Zeta variant offers up to Rs 1.95 lakh off.

Without MSSF, both variants come with a Rs 1 lakh discount. For a better deal, we would always recommend you get in touch with the nearest dealership and talk to the salesperson.