Consumer discounts unsustainable, will go down post October: Maruti Suzuki

Consumer offers on cars during the festive season have reached a peak and it will go down going forward as keeping discounts at such high levels is unsustainable, a senior Maruti Suzuki India (MSI) official has said.

The company, which is offering cash discounts and extended warranties on various models, witnessed its sales jump by 18-20 per cent last month as compared with July and August.

"We clearly tried to revive the market but we cannot have high level of promotions at all the time, these are not sustainable. So, going forward there will be decline in terms of offers," MSI Executive Director, Marketing and Sales Shashank Srivastava told PTI.

The company also expects current month to be better in terms of sales as compared with the same period last year.

"These are probably the green shoots and if we look at first week of October, which was Navratara period, then bookings and retails have been better than last year as far as Navratra period goes," Srivastava said.

Offtake of vehicles, including diesel models and BS-VI compliant eight cars, has been good and driving the sales, he added.

Besides, the recently launched model S-Presso has garnered over 10,000 bookings, Srivastava noted.

The company has already stopped production of BS-IV cars for the models in which BS-VI has been introduced, he added.

For the rest of the models, the decision to cease BS-IV production will be taken keeping in mind the inventory levels, Srivastava said.

He, however, added that it would be too early to say that the auto sector is out of the woods and it would take at least two more months to get a clear picture.

"We have to see that in absence of this stimuli (promotions) whether there is an upturn or not. That I think will be evident in the next few months then we will be able to make more definitive statements about the change in fortunes of auto industry," Srivastava said.

Counting on the positives, he added that the demand from rural markets is set to improve with better monsoon and expectations of a good crop.

Besides, plans to launch petrol versions of Vitara Brezza and S-Cross should give boost to company's sales as there is already a shift from diesel to petrol in all segments of the market, Srivastava said.

He did not elaborate on the exact launch dates of two cars, but said that "it will definitely happen during this fiscal."

Currently, the company offers both the models with 1.3 litre diesel powertrains.

MSI has already stated that it will stop selling models with diesel engines from April 1 next year.