Maruti Udyog Limited, the largest passenger carmaker in the country, on Monday admitted that the week-long truckers' strike has hit its production by 30 per cent at its Gurgaon facility.
Maruti managing director Jagdish Khattar told the media in Bangalore that supply of critical components and accessories from its vendors to the factory have virtually come to a grinding halt.
"Though we have not shut the plant, we are somehow managing with the earlier supplies. We are watching the situation closely. Some of our vendors who have their warehouses near our plant facility are still managing to supply some of the inputs for assembling," Khattar said.
The ongoing truckers' strike has also affected the transportation of its various models across the country by 10-15 per cent. The company's installed production capacity is about 350,000 units per annum.
While inventory has been piling up at the plant site, several Maruti dealers have reported dwindling of stocks, including 800 and Alto, the fastest selling models from the company's stable.
With no let-up in the strike, Maruti has started using rail rakes to dispatch its vehicles across the country and advised vendors to maintain supplies through rail freight lines.
Khattar told rediff.com that the company was targeting a 10 per cent growth during the current fiscal year (2002-03) as against a flat growth rate during the preceding fiscal (2002-03).
"Our projected target growth, however, depends on various factors, including the ensuing monsoon, industrial upturn, and surge in consumer spending.
During the last year, sales remained at about 50 per cent in the first four months (April-July 2002), but picked up gradually scaling up to 56 per cent after we undertook price rationalisation and passed on the benefits of reduction in excise duty of 8 per cent to our customers," Khattar stated.
With a 54 per cent market share, Maruti sold about 330,000 cars at the end of March 31, 2003. Its exports jumped to 32,000 during the year under review from a mere 12,000 in the fiscal year 2001-02.
On the pricing front, Khattar stated the company was working under pressure to maintain margins in view of the increasing cost of raw materials, especially steel.
In order to meet the projected target, Khattar declared that its recent tie-up with the State Bank of India would enable the company to reach 100 more cities for auto financing to new customers.
"Through our own Maruti finance, we are able to cover about 60-65 cities though we have a presence in about 100 cities through our dealer network. The tie-up with SBI will push our sales aggressively this year," Khattar claimed.
The Rs 9410 crore (Rs 94.10 billion) company has also set an export target of 39,000 for the current fiscal. Its Alto model emerged as number one car in the Netherlands under the A segment in Europe.
Earlier, Khattar disclosed that the company had received about 70 bookings in the first week of launching its first sports utility vehicle, Grand Vitara XL-7.
"We have shipped about 50 vehicles in completely built units for the launch. With bookings exceeding our expectations, we will be importing about 100 more in the coming months from the parent plant, Suzuki in Japan to meet the customers demand," Khattar affirmed.
Priced at Rs 1.7 million, Grand Vitara attracts a whopping levy of 109 per cent, including 60 per cent import duty, 16 per cent counter-veiling duty, 16 per cent excise duty and 4 per cent special additional duty.
Regarding Maruti's initial public offering, slated in June, Khattar said the company would be filing its documents with the Securities Exchange Board of India this week through its merchant bankers.