Tata cuts production by 33% in September
In a recent attempt to escape from heavy loss owing to sluggish demand of cars, Tata Motors had cut the production of most of its passenger cars including the Tata Nano in the month of September. The information is given by parts vendors to whom Tata Motors have communicated that they planned to manufacture just 12,000 cars in this month. This figure is almost 33% less than the cars produced in the corresponding month last year. One of the auto part executives described the grim situation by saying that supplies to Tata Motors have been down since the beginning of this year and that September offtake will be much lower than August.
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On an average, Tata Motors has been rolling out 18,700 units since April 2011 till August. The company decided a production cut in the month of August also which was quite similar in nature. Now, hiked fuel and interest rates have taken a toll on Tata Motors in September also. The sales of Tata Nano over the past few months have been dismal for the probable reason of its fire catching incidents. In a bid to trim inventory Tata Motors will produce just 2000 units of the Nano in the current month. Tata Motors is also very popular for the series of its SUVs like Tata Aria, Tata Safari and Tata Sumo. Even small car like Tata Indica is the all time favorite car of Indians.
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The sting of low demand has been eating the car makers badly in India badly. They have to bear the brunt of high costing auto parts and then they have to keep prices of the car low due to market compulsion. Even after such alteration, customers are not showing their faces in the showrooms. The ever-low demand has led even car giant-Tata Motors to reduce the production. Not just Tata but sales have fallen sharply for India’s No. 1 car maker, Maruti India as well.
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