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| Popular model launches put pressure on car firms' production |
| Yogima Seth Sharma / New Delhi May 01, 2010, 14:44 IST |
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GM begins second shift, Ford to do likewise, Maruti trying to prepone third factory’s opening
With a growing waiting list for the much awaited new models of the Chevrolet Beat, Ford Figo and the Wagon R, manufacturers are being forced to spruce their production capacity to meet the demand.
General Motors India, which launched Beat in January, has started a second shift at its Talegaon factory (near Pune) since March. Ford India is contemplating a second shift from June. This would help these companies gear up for the festive season, when demand is expected to go up further.
“The A2 segment is now seen as an entry-level segment for a majority of first-time buyers, primarily because of various options in the segment and an increase in household incomes, along with comparatively softer rates of interest vis-à-vis last year,” said P Balendran, vice-president, GM India.
GM’s other factory, at Halol in Gujarat, has been operating a second shift since October last year. According to Balendran, with the second shift at the Talegaon unit, overall production is now at 12,000 units a month.
As noted earlier, For India has similar plans.“On the back of tremendous response to Figo, we are contemplating to start a second shift at our Chennai plant in the next three-four months and hope to increase the production by 30-40 per cent, as it will help us to cater to the festive demand. Ford Figo, launched in March, had bookings of more than 10,000 units in the first three weeks and out of this, the company has already delivered 7,210 units last month,” said Timothy D Tucker,vice president (sales).
Working on two shifts would enhance Ford’s Chennai factory annual output to 1,50,000 cars, of the total installed capacity of 2,00,000, and will entail hiring 700 additional workers.
Maruti Suzuki India had earlier said it would set up a third factory, a second unit close to the existing one at Manesar (near Delhi) at an investment of Rs 1,700 crore. The older factory is at Gurgaon. The company says it hopes to prepone the opening of this second Manesar plant (originally scheduled for 2012) to overcome the capacity constraints.
“We are running full capacity at our plants and with demand going up, I would be happy if we prepone the operations of our second plant in Manesar even by a day,” S Nakanishi, managing director and CEO, had said earlier. Till that happens, Maruti's engineers are putting in manual lines and the company is in the process of renovating, rationalising and debottlenecking its Gurgaon plant to put it to optimal use for its some of its largest selling models, in their segments, including the new Wagon R.
The Wagon R, its second largest-selling model, contributes nearly 17 per cent to the company’s sales.
It is estimated that the A2 segment, which comprises Maruti’s new Wagon R, the A-Star and Estilo, Hyundai’s Santro and i10, Chevrolet’s Beat, the Ford Figo, Tata Indica and Fiat Palio, would see higher growth than the industry estimate of 11-12 per cent. “Total sales of the A2 segment will outstrip industry sales this year and it is estimated that over 7,00,000 units would be sold in this segment alone, as compared 5,96,000 units sold last year, which would be growth of 17 per cent over 2009,” Balendran added.
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