Slowdown in India hits Suzuki's global revenues

New Delhi: Suzuki Motor Corp on Monday said its consolidated net sales declined by 80 billion yen (8.1 per cent) to 907.5 billion yen in the April-June quarter as compared to the year-ago period, mainly hit by slip in Indian sales as well as cut in production in Japan.

The company said the operating income decreased by 53.8 billion yen to 62.7 billion yen, down 46.2 per cent and net income attributable to owners of the parent declined by 45.4 billion yen (52.8 per cent) to 40.5 billion yen on a year-on-year basis.

"Net sales and income of this first quarter (April to June 2019) decreased owing to decrease in Japan production due to restructuring of final inspection structure, as well as decrease in Indian automobile sales due to slowdown in overall market," Suzuki Motor Corp said in a statement.

The company's net sales during the quarter were also impacted by decline in sales in other markets like Pakistan and Indonesia, and due to impact of Yen appreciation, it added.

Maruti Suzuki India (MSI), which is majority-owned by Suzuki, has seen sales slump in India due to a prolonged slowdown.

The company's domestic sales were down 36.3 per cent at 98,210 units last month compared to 1,54,150 units in July last year.

It was in June 2017 that the company's sales had last fallen below 1 lakh units in a month.

With prolonged slowdown, MSI has been forced to take various steps, including production cuts at its manufacturing plants, in order to adjust its inventory to market demand.

It had cut vehicle production for the fifth consecutive month in June by 15.6 per cent to 1,11,917 units as compared to 1,32,616 units in the year-ago month.

As per industry sources, the company has also reduced temporary manpower at its facilities and freezed new hiring till the slowdown continues.