So far no impact on supplies and production due to COVID-19, says Maruti Suzuki
We have stopped the BS-IV production altogether in January and we are only making BS-VI vehicles. Company started this transition almost a year back, said Shashank Srivastava, ED - International Operations of Maruti Suzuki.
Maruti Suzuki’s February auto sales disappointed street, there were no green shoots visible. De-growth continued albeit at a slower pace. Exports saw single digit sales growth while domestic sales continued to be under pressure.
Throwing further light on the company's performance in light of coronavirus disrupting supplies, Shashank Srivastava, ED - International Operations of Maruti Suzuki said so far there seems to be no effect as far as supply production is concerned but our supply chain team is closely watching the situation.
On domestic demand scenario Srivastava said, “If you look at the first half (H1) figures they were huge negative for the industry as also for Maruti Suzuki, somewhere in the range of like 16-17 percent. Thirds quarter figures were positive for Maruti although industry was negative. However, February seems to be negative across the space, except for couple of manufacturers like Ford and Renault most of the other manufacturers have shown smaller negative growth."
The industry has seen some transition of BS-IV to BS-VI issue in February, which would continue in March as well, he said in an interview with CNBC-TV18.
When asked about the rural-urban split for February and January sales he said, “Rural like last year was around 36 percent of our total sales. This year so far almost like 38.5 -39 percent is coming from rural areas. So there has been an uptick in the second half."
With the monsoon ending up with a positive plus 4 percent has led to expectation of bumper rabi crop and therefore the sentiments in the rural areas are much better and that is reflected in the sales figure over the past few months, said Srivastava.
Talking about growth expectation he said, “We are positive for the next year as rural demand sentimentally has been little better. However, the consensus growth expectations seem to be in the range of 3-5 percent for the industry. The SUV segment is seen slightly higher between 4-6 percent and the passenger car segment slightly lower, so on an average it would be between 3-5 percent for the industry s per consensus.”
Giving an update on BS-IV production he said, “We have stopped the BS-IV production altogether in January and we are only making BS-VI vehicles. Maruti Suzuki started this transition almost a year back so we introduced 14 brands and all of them are BS-VI.”
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