Maruti Suzuki may lose about Rs 2,660 crore of revenues, following the closure of the Manesar production facility which is now expected to continue for at least a month.

On Wednesday evening, the factory was closed indefinitely following violence in which Mr Awanish Kumar Dev, General Manager (HR), was killed and about 100 officials injured.

Fire also destroyed offices on the first floor of a building, apart from the main gate of the plant. This has prompted the company to consider a lockout for the plant. The Manesar factory, Maruti’s second facility after Gurgaon, has two production lines and a daily output of 1,900 units. It makes the carmaker’s most popular models currently - the Swift and Dzire, apart from the SX4 sedan and A-Star hatch.

A senior company official told Business Line that the factory may only restart after the Managing Director, Mr Shinzo Nakanishi, comes back from a meeting at Suzuki Motor headquarters in Hamamatsu, Japan after July 25 Some Suzuki officials from Japan are expected to visit and take stock of the situation.

Diesel Waiting Periods

The wait for top-selling diesel variants of the Swift and Dzire may also go up by two-three months if production halts for a month, another company official said. Currently, the Swift diesel has a waiting period of up to three months, while a customer of the Dzire diesel may have to wait for about five months. To compensate for the Manesar losses, Maruti may also try to increase assembly of the Swift at Gurgaon, and add Dzire production. But, this option is limited as the welded body for both models are only made at Manesar.

“We have no space at Gurgaon to add a welding line for the Swift, plus it will take at least a month and a half for it. Without the welded bodies from Gurgaon, these cars cannot be made,” said an official.

Around 33 of the over 90 company officials admitted with injuries to four Gurgaon hospitals are still to go home. Of this, the two Japanese in ICU have been moved to the general ward, while four more managers still remain under critical care.

Mr S. Sandilya, President, Society of Indian Automobile Manufacturers, said that such acts of violence sully the image of India as a manufacturing base, as an investment destination. Maruti Suzuki shares on the BSE were up 2.43 per cent to Rs 1,144.55 on Friday.

(This article was published on July 20, 2012)
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