Latest Car News in India

Maruti petrol cars production reduced, registering loss of 8 per cent production

It is a known fact that sales of petrol cars in India have attenuated and looking at the sluggish demand for petrol cars in India, Maruti Suzuki India has reduced the manufacturing of few of its petrol cars that include Maruti Alto, Maruti Wagon R, Maruti Eeco and Maruti A Star by 8 per cent of its monthly capacity in the last few days. The two lines of MSI’s Gurgaon plant have been shut for three days, May 25, 26 and June 2. Apart from this the units will be closed for a week as a part of the maintenance at the end of this month.

Three days for which the two lines at the Gurgaon units were closed incurred a loss of 8,000 units. A total of 1.4 units of Maruti cars are laying at the Maruti and dealer inventories, most of which are petrol versions.

MSI manufactures around one lakh cars in a month out of which 25 days are working; this figure is achieved when the production is in full swing at the Manesar units. The demand for diesel cars in India has been surging since June 2012 when petrol prices started shooting up. The price difference between petrol prices and diesel prices has reached an all time high especially after the recent Rs 7 hike in petrol prices.

With the sudden out stripping demand for diesel cars in India, the auto makers have been facing constraint in the supply of diesel engines. On the hand the petrol engines are lying unused in the inventories of the companies. Maruti is all set to set up a new diesel engine plant in India; however until then it will have to source diesel engines from Fiat to suffice its diesel engine requirements. The new diesel engine plant will be functional by next year.

Maruti Suzuki India inked a pact with Fiat India in the month of January; under the pact Fiat will source 9,000 diesel engines in a month. In the month of March the company also finalized a whopping Rs 1,700 crore investment for enhancing the diesel engine capacity at its Gurgaon plant to six lakh units by 2014.Cars which are also offered in diesel variants along with petrol like Maruti Swift Dzire, Maruti Ertiga and Maruti Ritz, just 20-30 per cent of the production capacity is for petrol powered units. The production of petrol cars is likely to be reduced further provided if the diesel engine supply surged.