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Indian OEMs suffer from low capacity utilization

India has become an automobile hub thanks to lower real estate costs, trained manpower availability, low manpower costs and high vendor base. However, despite these facilities, the Indian mass market OEMs have a low capacity utilization.

Barring the market leader Maruti Suzuki and the No. 2 placed Hyundai, who have capacity utilization figures of 94% and 90% respectively, other carmakers have very low figures. New entrant Kia has a 51% rate at their plant in Andhra Pradesh while Renault-Nissan has a capacity utilization of 50% at their Chennai plant.

Ford with 2 plants at Sanand, Gujarat and Chennai, Tamil Nadu has 45% plant utilization. Volkswagen with a plant in Chakan, Pune has 43% capacity utilization while Mahindra's capacity utilization across 5 plants located in Maharashtra, Tamil Nadu and Karnataka is just 37%.

The capacity utilization of other manufacturers like Honda, Toyota, Tata, MG, Skoda and FCA is 34%, 31%, 30%, 29%, 14% and 8% respectively.

Source

 
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