The auto major, which has around 50 per cent market share in the domestic passenger vehicle segment, anticipates a hit on the manufacturing activities as lockdowns would impact the functioning of its sales network.
“There could be an impact if lockdowns continue because then sales outlets would remain closed,” MSI Chairman RC Bhargava told PTI when asked if he expects a hit on the company’s production activities amid spike in the COVID-19 situation in the country.
When asked if the production could go down by as much as 50 per cent due to the pandemic-related disruptions, he noted: “We don’t know yet how it will be in the future. It all depends on how it (lockdowns) continues. It has just been a few days.”
Bhargava further said: “I think we will have to see how the situation emerges over the next few days. We don’t know yet. Let us wait a week or so, then we will know better how things are.”
MSI’s two Haryana-based plants have an installed production capacity of over 15 lakh units per annum. Besides, Suzuki’s Gujarat-based plant, which manufactures cars on a contract basis for MSI, has an annual production capacity of 7.5 lakh units.
On April, 27, while addressing a virtual press conference, Bhargava had noted that despite the surge in COVID-19 cases in the second wave of the pandemic, the company has been able to continue with full production.
The next day, however, the auto major announced that it has decided to advance maintenance shutdown at its two Haryana-based manufacturing plants by a month, from May 1 to 9, in order to divert oxygen used in its manufacturing process for medical purposes.
In the last few days, several states have announced lockdowns to curtail the spread of infectious disease. Facing the world’s fastest-growing coronavirus outbreak, India has seen a near collapse of its health care system in several parts as hospitals ran out of oxygen and did not have enough beds to admit new patients.
In such a situation, various automakers have either decided to advance their annual maintenance shutdowns or go slow in production activities.
On Monday, Mahindra & Mahindra announced to advance the annual maintenance plant shutdown of its automotive division to this month. The maintenance of four working days was originally scheduled for June 2021.
Other companies, including Hero MotoCorp, MG Motor India, Toyota, Honda Motorcycle and Scooter India (HMSI), and Suzuki Motorcycle India have already announced the temporary suspension of manufacturing operations as the devastating second wave of COVID-19 sweeps across the country.