The country’s largest carmaker Maruti Suzuki India (MSI) on Tuesday resumed operations at its Manesar plant in Haryana after about 50 days of closure due to the coronavirus-led lockdown.
The company which rolls out high selling models like Alto, Swift, Dzire, S-Presso, Ertiga and Baleno from the plant, has initiated the work on a single shift basis. MSI is the latest carmaker to restart operations in the third phase of the nationwide lockdown, which has significantly impacted economic activity. Various other automakers like Hyundai, Toyota, Renault and Nissan have also announced partial resumption of operations in the last few days.
The Manesar plant of MSI has an installed capacity of 8.8 lakh units per annum on double shift basis, and lost around 40 working days during the lockdown. MSI suspended work at both its plants in Haryana — Manesar and Gurugram — on March 22 to fight coronavirus pandemic.
The company is yet to start operations at its Gurugram facility which rolls out models like S-Cross, Vitara Brezza, Ignis and Super Carry light commercial vehicle.
When contacted, MSI Chairman RC Bhargava told PTI, “The production has commenced at the Manesar plant and the first car would roll out today.” When asked by when would the plant become fully operational, Mr Bhargava said it would depend on government regulations.
“It will depend when the government allows double shifts. It would also depend when the authorities would allow increase in manpower, when will supply chain resume fully, so there are many variables involved.”
However, he didn’t give a clear answer on restarting manufacturing activities at Gurugram facility.
“It will start but not yet”, Bhargava noted. MSI’s Manesar plant is outside the limits of Gurugram Municipal Corporation, while its Gurugram plant falls within the city limits.
The company currently has a market share of around 54 percent in the domestic passenger vehicle segment, and both its facilities have an installed capacity to churn out over 15.5 lakh vehicles per annum.
On April 22, the Haryana government had granted permission to the auto major to restart its Manesar manufacturing facility, but the company had said it will resume operations only when it can maintain continuous production and sell vehicles, “which is not possible at this point of time”.
The Gurugram district administration had allowed the auto major to run the facility on a single shift basis, while fixing the total number of employees at plant at 4,696.
When asked how the lockdown would impact industry sales this fiscal, Mr Bhargava said that in current circumstances it is too early to forecast.
He, however, pointed out that cars in the country are among most highly taxed in the world.
“I have always held that cars are too heavily taxed in India, both by the central government as well as the state governments as both are putting taxes. The result is that cars in India pay much much higher taxes than in most other developed parts of the world,” he noted.
When asked if he could suggest some changes in the tax structure, Mr Bhargava said that he can’t do that and it is for the government to decide. The company has already re-opened 600 dealerships following relaxation of guidelines by the government for the third phase of lockdown.
As of last week, MSI, which has around 3,080 dealerships across 1,960 cities and towns in the country, had managed to open 474 Arena outlets, 80 Nexa dealerships and 45 commercial vehicle sales outlets.