Maruti Suzuki saw a growth in its production in November after nine long months of cuts. The increase in the production in November is a reflection of sales which happened in October, according to Shashank Srivastava, ED - Marketing and Sales, Maruti Suzuki.
“Production in any industry is a factor of retail, so whenever the retails are good, production has to... that is why in the first half there have been cuts in production. It is quite natural that based on the retail, the production will be adjusted," said Srivastava.
The company announced earlier this month that it will increase the prices from January 2020. The price hike has been necessitated on account of the increase in input cost, it had said.
Elaborating on the price hikes, Srivastava said, “I can’t really discuss the quantum of price rise, we are still discussing and we are looking at our model wise cost impact. However, I must tell you that input cost having risen and also because of the discounts levels, which are pretty high at the moment... obviously these two factors will lead to increased prices in January."
According to Srivastava, December, therefore, is a very good time to buy because "the discount levels are some of the highest in the entire year".
Talking about the demand in December, he said, “December, the starting seems to be quite okay in terms of the enquiry levels, especially for petrol and BS-VI vehicles... we have to be cautious about before we conclude whether the industry is out of the woods.”
Maruti Suzuki has already introduced eight models with BS-VI starting from April of 2019, much ahead of the government-mandated deadline of April 1, 2020.
The conversion from BS-IV to BS-VI will roughly see a price hike of Rs 10,000 to Rs 14,000 for a vehicle, according to Srivastava.
"We have already done it in major models — Baleno, Alto, Wagon R, Swift, Dzire, Ertiga, XL6 and S-Presso, without getting into the model wise costing etc., because some of the price increases would factor in obviously the feature changes which happened in the vehicle as also other factors of cost. In a generic way, I can say conversion in gasoline vehicle from BS-IV to BS-VI probably entails a price hike of roughly between Rs 10,000-14,000," he said.
He further added that October saw a very low inventory level — roughly about 18-20 days. November end, however, had roughly about 25-26 days of inventory.