Maruti Suzuki India in 2011 has been marred by the slowdown in car sales which has affected other automobile manufacturers as well. However, the company has had additional trouble at its Manesar manufacturing plant where the company’s labor force took to strike and halted the production of cars altogether. The strikes occurring frequently evenly throughout the year 2011 eventually cost the company a loss of approximately Rs. 2,500 crore (500 million USD) by the end of the third quarter of the fiscal in December 2011. The company hopes that the worst is over and plans to regain and further expand its production.
The company has lost around 40,000 units of vehicles due to the strikes at its production units. The Manesar facility manufacturers and assembles some of the high-value models for Maruti Suzuki including the Swift hatchback and the Swift Dzire. As the waiting period has increased especially for these two car models, despite efforts, Maruti Suzuk has not been able to recover its lost market share or profits.
Further deteriorating the condition is the depreciation of the Indian rupee which has resulted in a hike in the import costs of automobile parts and a higher royalty payable to the Japanese parent company Suzuki.
Although Maruti Suzuki is not very hopeful about the remainder of the fiscal 2011-12, the company plans to drive the Indian automobile industry with a series of planned launches and expansion of diesel engines and diesel powered vehicles. The industry analysts have voiced similar sentiments and expect a 15 percent growth in volume of the company in the 2012-13 fiscal.
