In an attempt to cut costs and tackle the slowdown that has hit the automobile industry, Maruti Suzuki India has laid off more than 1,000 temporary employees. It is also expected to freeze hiring and look at other cost-cutting measures.
Whenever such layoffs are planned, it is always the temporary staff that get affected first. It is reported that with sales being very slow, the inventory has been piling up at the dealers. That is why, the Company, just like several other auto companies, has decided to trim down the workforce.
Maruti Suzuki India reported a 33.5 per cent drop in total sales, including exports for July. The total sales of the Company dropped to 1,09,264 units last week, from 1,64,369, recorded in July of 2018-19. The domestic sales fell by 35.1 per cent to 1,00,006 units in July year-on-year (YoY).
Although, the total domestic passenger vehicle sales dropped by 36.7 per cent to 96,478 units YoY, the company’s light commercial vehicles’ sales in the country went slightly up 0.5 per cent to 1,732 units.
There was a fall in exports by 9.4 per cent to 9,258 units from 10,219 during July 2019.
As compared to the first quarter, its net profit saw a decrease of 27.3 per cent in July 2019, falling to Rs 1,435.5 crore for the quarter.
The reason for this is falling sales and increasing depreciation expenses.