Maruti Suzuki production hit due to parts shortage
Jat protests mar transportation of parts; operations in Gurgaon, Manesar may resume on Tuesday
Production at Maruti Suzuki India Ltd’s manufacturing units in Gurgaon and Manesar will likely be affected this week because of a shortage of parts caused by protests by members of the Jat community in Haryana that have affected life and work in the Delhi satellite cities.
Maruti could not start production even on Monday, and will also not operate the first shift on Tuesday, the company said in a circular to employees. It will, however, produce vehicles during the second and third shifts, the company added.
“We will assess the situation tomorrow morning and then take a call on the future course of action," a company spokesperson said without disclosing details.
Maruti Suzuki has two plants, one each in Gurgaon and Manesar, both surrounded by pockets with a sizeable Jat population. The combined output from the two plants is currently about 5,000 vehicles per day.
Between Saturday and Tuesday, the company is likely to incur a production loss of at least 10,000 vehicles. A person familiar with the matter who asked not to be identified said Maruti is expected to ramp up output to make up for the losses when the situation in the Gurgaon-Manesar belt normalizes.
Another senior executive from a leading auto parts maker said his company received instructions from Maruti to build “safety stock for a week".
“It seems the production will be badly affected this entire week. One can expect normalcy in operations from Friday," this person added, requesting anonymity.
Much like Maruti, many of its suppliers operate on a JIT or just-in-time basis and their inability to work shifts because of the Jat protests, caused disruptions at India’s largest car maker.
Owing to the agitation in Rohtak district of Haryana and nearby areas, “supplies of certain components have been disrupted", Maruti said on Saturday.
“The company is making efforts to arrange the components from other sources. Once the supply of components is restored, normal operations will resume," the firm said.
Maruti isn’t the only auto company to be affected by the stir.
Production at Hero MotoCorp Ltd, India’s largest two-wheeler maker, was also disrupted.
“Despatches from all our plants—at Gurgaon and Dharuhera (Haryana), Neemrana (Rajasthan) and Haridwar (Uttarakhand)—have been affected due to the ongoing blockade of the national highways and other roads. Production output has also been partially impacted today at our plants due to the ongoing impasse," a Hero spokesperson said.
Shares of Maruti Suzuki closed down 1.61% on BSE Ltd at ₹ 3,523.30 each. BSE’s benchmark Sensex index closed 0.34% up. The decline wiped ₹ 1,744 crore off its market capitalization.
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