Maruti predicts single-digit growth; warns dealers


According to a media report, Maruti Suzuki is expecting single digit growth this year and has warned its dealers of tough times ahead.

This year, Maruti is likely to launch a concept Future-S based compact crossover, Brezza petrol, sports variant of the Ertiga and a WagonR-based 7-seater MPV. The new launches are expected aid growth, which is estimated to be around 5% compared to the previous fiscal.

Last year, Maruti Suzuki had reported a growth of 5%. In April 2019 alone, the carmaker reported a nearly 20% drop in sales despite dealers offering heavy discounts. As a result, Maruti has reportedly cut production by 20% in the last 2 months.

With drop in sales and falling margins, dealerships are struggling to stay afloat. Reports suggest that over 205 dealers and 300 dealer outlets have shut down in the past 2 years. At least 7 Maruti dealers have reportedly shut down last year. As dealers are under increasing financial pressure, Maruti Suzuki is planning to build new showrooms at its own cost and lease them out to dealers.

Source: Money Control

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