Maruti Suzuki and Hyundai to restart production in May
A business news outlet has reported that Maruti Suzuki and Hyundai, the country's two largest carmakers, are planning on getting their production facilities back online in the coming month, in the wake of the ongoing COVID19 pandemic in the country. The two firms together control over 70 per cent of the Indian car market, hence the significance of this move.
To ensure all hygiene and social distancing norms are adhered to, the Maruti and Hyundai plants will initially operate only at 20 to 30 per cent capacity, and then ramp up production as markets across the country open up and restrictions are lifted.
Maruti Suzuki has been given permission to run one shift at its Manesar plant. It hopes to make 45,000 cars in May which should then increase to 65,000 in June, if restrictions lift enough. The Japanese carmaker usually produces 1.5 lakh cars a month at its facility usually, across three shifts. Hyundai will produce 12,500 to 13,000 units at its plant in Chennai and gradually ramp up to the 60,000 cars that it usually makes each month.
The report suggests that Maruti Suzuki will focus on its more affordable models first. In the case of Hyundai, we think the company will look to fulfill the orders it has for its popular models like the newly launched second-gen Hyundai Creta and the smaller Venue SUV. However, both carmakers will have to plan production around how robust their supply chain will be. Many component makers are based out of Maharashtra and Gujarat, where the coronavirus situation is at a critical stage.
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