The major players like Maruti, Tata Motors, Hyundai among others in the Indian automotive industry have lined up their plans for production with the stagnant automotive economy by slashing production for the month of July so as to avoid stock-pile of inventory. The Indian car market is depreciated at the moment with customers unwilling to risk purchases due to the fear of high interest rates and out of control fuel prices.
Car makers face the brunt of the automotive economy's dwindling sales figures but the effect is not limited to just them. Other companies associated with the automotive industry are also facing hardships. Component makers like Bosch and many others are following suit and cutting down production by temporarily shutting plants and reducing employee shop floor timings to sustain themselves. According to statistics, automotive companies may have as many as four lakh plus units stockpiled in store, up from three lakh in May. The category most affected by the negative automotive economic conditions are petrol vehicles. Commenting on this stagnation a senior Maruti Suzuki executive reported, “There is no respite in slowdown this month. In fact the inventory has increased since May. There would be some steps to rationalise shop floor operations, especially of petrol vehicles manufactured out of Gurgaon next month.”
Tata Motors faces worsening conditions as sales of both its passenger vehicle segment and commercial vehicle segment drips into lower and lower numbers causing plant closures. Tata Motors has shut its truck factory in Pune for three days from the 28th to the 30th of June, post to its closure of the Jamshedpur plant which we had covered in the news a few days ago. “All different plants would have rationalised production as we want to keep our inventory under control,” a Tata Motors senior executive announced.