Suzuki defers production at new Maruti plant

NEW DELHI: Maruti’s parent Suzuki has decided to defer the start of production from a new car plant in Gujarat — being built with an investment of Rs 3,800 crore — till next year as a slowdown in demand due to the coronavirus is likely to keep buyer sentiment low. Maruti is also going slow on the shifting of its Gurugram facility — which falls within a residential area — to a new location due to coronavirus restrictions, chairman R C Bhargava has said.
“The third plant (at Gujarat) is more or less ready, but there is no market for it. So, there will be a further delay in its production,” Bhargava said, while speaking at the opening session of TOI Dialogues, a unique leadership summit that was held last Tuesday (the topic was business continuity in the times of Covid). “I think the start of production is now planned for some time in 2021, and not in 2020. Earlier, we were hoping for the beginning of 2021. Now the timing will depend on what is required from the third plant,” he said.
Suzuki has two plants at Hansalpur in Gujarat, and these have a cumulative annual vehicle production capacity of 5 lakh units, apart from a powertrain manufacturing unit. The third plant, which would be adding 2.5 lakh units, had been under construction, though the work seems to have slowed down. The Maruti chairman said that the pandemic and resultant lockdown and further restrictions will keep the demand for new cars low.
Won’t hike prices, says chairman
Maruti chairman R C Bhargava has said the company will not raise car prices even though its manufacturing costs have gone up due to the safety precautions and the protective apparatus. “Costs will be higher this year and margins will be lower because we are not going to run at full capacity either. We cannot increase the prices even if the costs go up,” Bhargava said. (TNN)


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