Maruti Suzuki’s healthy numbers in the recent September quarter must be seen in the light of the month-long shutdown and the later slow ramp-up in production at the Manesar plant in Haryana in the same quarter last year.

But for the advantage of a lower base, nothing much has worked for the company on the domestic front.

With diesel prices linked to the market in stages, consumer preference for diesel vehicles has been wearing off in the last six months.

The share of diesel vehicles, which was at 37 per cent of the total vehicles sold by Maruti in 2012-13, dropped to 34 per cent in the first quarter of 2013-14 and further to 30 per cent in the September quarter.

With diesel vehicles having higher price points and better margins, Maruti could take a knock on this front in the next quarter.

Second, the Ertiga utility vehicle is not holding the fort for the company as much as it did in 2012-13. Given the waning attraction of diesel vehicles, the runaway demand for utility vehicles witnessed in 2012-13 has softened in the first six months of this fiscal.

At only about 11,800 vehicles in the quarter, Maruti sold about 45 per cent lower Gypsys and Ertigas in the July-September quarter, compared with the corresponding period last year.

Third, discounts have also moved upwards.

Average discounts for this quarter stood at Rs 17,500 per vehicle, higher than Rs 14,150 in the year-ago period and Rs 13,500 in the June 2013 quarter.

In the months to come, though improved exports and higher rural demand may continue to drive growth to an extent, prospects otherwise remain muted.

> vardhini.c@thehindu.co.in

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