Friday, February 03, 2012
By Manoj Kumawat
Maruti’s labor strike played spoilsport for Suzuki
Maruti India has no doubt suffered a lot due to the erstwhile strike at its Manesar production unit in 2011. The repercussions of the lack of production in India have percolated to Suzuki Motor Corp's (SMC) overseas car output as well. Following the lack of production of cars in India, SMC has faced 2.12 percent for the first time in last 11 years. Notably, Maruti India is the biggest car maker compared to other operations by SMC and has a major contribution in SMC’s annual profits.
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In India where the strike has affected the production and sale of Maruti Swift and Maruti Swift Dzire, it has also affected the overall production of other Maruti cars as well. Manesar plant has SMC’s major stake in it and following the strike there was an output loss of over 1 lakh cars in 2011 as well as severely affecting the launch of other Maruti cars such as the New Maruti Swift Dzire. Resulting the strike, Maruti’s market share has come down to 39 percent and it had to suffer a monetary loss of around Rs 995 crore. Maruti car sales too came down by 14 percent to 8.8 lakh units till January 2012 when the sales have improved striking a positive chord in Maruti’s stable.
|See More Maruti Swift Photos||Get Maruti Swift Price|
Thus far with such production constraints and consequent narrowing of profits, Year 2011 is considered as the worst year for Maruti since its inception. However, now Maruti has set in measures to fool proof production. Among them is the inking of a deal with Fiat for the supply of 1 lakh diesel engine annually till 2014. This will help Maruti step up production and revive its loss of grip over the Indian car market lately. Now, that production is normal and full swing, Maruti car sales in India have gradually come back on track with a slight improvement. The recent launch of new Maruti Swift Dzire and the upcoming Maruti XA Alpha and MPV Maruti Ertiga are expected to further help strengthen Maruti car sales in India.