Maruti Suzuki to cut October output by 40% due to semiconductor shortage

The car market leader said total production at all its manufacturing locations will be 60 percent of the normal production in October. This is a slight improvement over the 40 percent production level seen in September. For September and October, the carmaker will see an average of 50 percent cut in production.

"Though the situation is quite dynamic, it is currently estimated that the total vehicle production volume across both locations could be around 60 percent of normal production," Maruti Suzuki added.

Though Maruti Suzuki did not specify its normal production levels, the company's and that of SMG's total July output stood at 170,719 units. July did not witness any such supply and production-related challenges. August output, however, was lower due to a partial shutdown carried out by SMG.

On August 4, the contract manufacturing company Suzuki Motor Gujarat (SMG) said it will shut production for three consecutive Saturdays in August and may also bring down working to just one shift owing to the semiconductor shortage.

SMG, which is owned by Suzuki Motor Company, Japan, supplies fully built cars such as Swift and Baleno to Maruti Suzuki India (MSIL) for sale. This was for the first time that India's largest carmaker has called out a production issue due to non-availability of chips.

The cut in output comes just at the start of the festive season which begins on October 7 with the start of Navratri. This is usually the time of the year when automakers build inventory for the rush in demand. The festive period has traditionally generated between 30-40 percent of the annual demand for the automotive industry.