Saturday, September 01, 2012

SOLVING THE BACKLOG RIDDLE!

Mayank Pareek, Managing Executive Officer - Marketing & Sales, Maruti Suzuki India

CRITICS CLAIM THAT MARUTI WAS NOT PROACTIVE ABOUT PLANNING FOR THE HUGE RISE IN DEMAND FOR CARS IN INDIA. MAYANK PAREEK DEFENDS HIS CASE.


B&E: Can you throw some light on what kind of waiting period are buyers facing, as almost all your products are currently running with backlogs?
Mayank Pareek (MP): We are currently carrying close to 15-20% of out total average monthly sales as backlogs on our books. It is not because we want the consumers to wait, it is because the demand is very high from the consumers. We are producing as much as we can, but it is not enough. Be it the suppliers or the auto majors, no one was prepared for such a high demand growth.

B&E: But what about your capacity expansion plans? Doesn’t the company plan to add 250,000 units to the current annual production levels of 1 million?
MP: We are trying our level best. What has happened is that the industry was expected to grow at a pace of close to 13-15%. But over the past few months, it has grown by over 30%. Having said that, we are even producing close to 30% more than what we produced during the same period last year, by simply modifying our assembly lines. We are even trying to prepone the capacity expansion plan by close to 6 months. So, you can expect the company to produce an additional 250,000 units beginning some time in 2011. But till then, we will have to manage with our existing capacity and try and produce as many cars as possible.


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