Maruti Suzuki raises output estimate for November to March

Mumbai: Maruti Suzuki has raised its production estimate for the rest of this fiscal year, encouraged by strong sales during the just-concluded festive season and a long order backlog, people in the know of its plans said.The output in November and December was expected to be cut as demand usually weakens after the festive season. Instead, Maruti Suzuki has guided for a 2-11% higher production compared with what it had projected in August for the November to March period.The maker of the Swift hatchback and Vitara Breeza SUV is eyeing production of 525,000-550,000 units, including output from parent Suzuki Motor’s Gujarat plant, in the fiscal fourth quarter of January-March. That would be at least 27% more from a year earlier and exceed the around 500,000 units it sold in the second quarter of fiscal 2019, which is the highest on record in a quarter for the company.“The company is hoping to sell 20% more in the five months (November to March) of the fiscal than what it did in the first seven months of FY21,” one of the people said on the condition of anonymity.Achieving those numbers will help Maruti Suzuki limit the drop in its fiscal 2021 output to 5-8%, compared with a 20% decline forecast by parent Suzuki Motor and 13-14% factored in by analysts.An email sent to the company seeking comment did not elicit any response till the time of going to press on Monday.A single-digit decline in sales at the market leader, along with sustained demand for rivals Hyundai Motor, Kia, Mahindra & Mahindra and Tata Motors that are also sitting on pending bookings, would help the passenger vehicle industry post a lower-than-expected decline in fiscal 2021 numbers.At the second-quarter earnings conference, Maruti Suzuki had expressed visibility of demand till December, but had said it was unsure of demand sustaining beyond that. But a strong production schedule now indicates that the pent-up demand is likely to continue well into the fourth quarter. 79377316 The company had sold 5,87,345 units in the April to October period, a 27% drop from the year-earlier period after the pandemic and lockdown crippled production and the market in the first few months.It produced 166,086 units in September and 182,490 units in October, up 25% and 53%, respectively, from a year earlier. The tentative monthly schedule of the fourth quarter is quite similar to the production in October. Strong demand during the festivals had helped Maruti Suzuki cut cash discounts, which on average dropped by nearly 20% from the previous month.

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