Current dealer stock level at 36 days, no intent of lowering it in festive season: MSIL

Maruti Suzuki reported that at the start of August, the company's dealer stock levels were at 38 days. Through targeted efforts, they've since reduced it to 36 days. It said that during the upcoming festive season, there’s no intention of further stock correction.

“Our focus has been more to see to it that our channel partners are able to have a reasonably healthy stock to sell the vehicles. So, we are continuously trying to bring the stocks down. As compared to previous years, we’re trying to calibrate our dispatches. We have reduced the dispatches by 13,000 vehicles in August and for the industry the number should be around 3,50,000,” Partho Banerjee, Senior Executive Officer of Marketing & Sales at Maruti Suzuki India Limited said. 

He added that compared to the wholesale for the April to August, the company has reached the 6,99,652 vehicles. “We have a market share of 40.4% in the dispatches. Coming to the retail part of it, our retail is in line with the wholesale, and it is slightly better than that,” he adds.

India’s largest carmaker Maruti Suzuki sales in August 2024 saw a decline, primarily driven by a significant drop in the small car segment, which includes mini and compact cars like Alto, Baleno, Celerio, Dzire, Swift, and others. The automaker's August sales in the small car segment declined 18.85 per cent to 68,699 units in August 2024, compared year-on-year with 84,660 units the previous year, as per the sales data released on Sunday.

Maruti Suzuki sold 181,782 units in August 2024, down from 189,082 units in August 2023—reporting a 4 percent year-on-year (YoY) decline, according to the latest sales data.

Since Onam is in September, the company expects retails to improve this month. “Last year, Onam was in the month of August from 27th-20th. This year, it’s from 16th-18th September. So, it is not like to like comparison, but this year if we see in the state of Kerala, the month of August, we are seeing there is a growth of 7% in bookings and the retail has been more or less the same as compared to last year,” he said. “In the month of September, all these bookings will be converting into retails.”

He added that the company doesn’t have any intent to further reduce the network stock. “We feel there could be a loss of sale if the dealers don't have adequate stocks in their network. Just by dispatching vehicles from the OEM stock here to the dealer stock here doesn't help in any way. An measuring how many vehicles we have dispatched is not the right true picture of the market. So, last month also we did some dispatch corrections. And this month also we are doing some dispatch correction in line with the retails,” he explained.

The company is banking on the upcoming festive season for retail levels to improve. “Navratras are going to start from the beginning of October. So we don't have any intent now to further do any stock correction because we feel now we have reached to that level which is okay. As the number of production days goes down due to the festival seasons, so our production reduces. So, there will not be any further more increase in the offers,” he said.

He added that the company wants to maintain a similar type of stock level now for the upcoming festival season.