Maruti Suzuki India Limited (MSIL), the country’s largest car maker, on Tuesday reported a net profit of Rs 227.50 crore for the quarter ended September, a fall of 5.4 per cent compared with the Rs 240-crore net profit in the year-ago period. Labour woes at its Manesar facility and higher discounts to push sales of petrol vehicles led to the fall in profit.
This was MSIL’s fifth consecutive quarterly fall in profit.
Net sales for the quarter, however, rose 8.5 per cent to Rs 8,070 crore, against Rs 7,436 crore in the corresponding period last year, owing to robust demand for the new Ertiga and higher realisation through exports. However, overall vehicle sales, including exports, dropped 8.7 per cent to 2,30,376 units.
Shinzo Nakanishi, managing director and chief executive officer, MSIL, said, “We suffered production loss of 77,000 units due to the strike at Manesar. We had declared a lockout at the facility for about a month, which impacted production of diesel vehicles, for which there is high demand.” The company sold 2,09,954 units in the domestic market, 5.9 per cent lower than the 2,22,406 units it sold in the corresponding period last year.
“In the first half, while demand for petrol cars dropped 20 per cent, that of diesel vehicles increased 40 per cent,” said Mayank Pareek, chief operating officer (sales & marketing), MSIL. To improve the subdued demand for petrol cars, the company enhanced sales-promotion measures, which impacted profitability.