Maruti Suzuki share price slips 3% as chip shortage to hit production

Stocks

The company has said that vehicle production at its Haryana and Gujarat plants in October would be 60% of the normal output

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Maruti Suzuki India share price slipped 3 percent in the early trade on October 1 after India’s largest carmaker said it would have to cut down production to 60 percent during the month due to a shortage of semiconductors.

This is the second time in as many months that Maruti, which is expected to share its monthly sales data for the month of September later in the day, has warned of production cuts due to the chip shortage that has hit businesses across the globe.

“Owing to a supply constraint of electronic components due to the semiconductor shortage situation, the company is expecting an adverse impact on vehicle production in the month of October’21, in both Haryana and its contract manufacturing company, Suzuki Motor Gujarat Private Limited (SMG) in Gujarat,” the company said in a press release.

“Though the situation is quite dynamic, it is currently estimated that the total vehicle production volume across both locations could be around 60 percent of the normal production.”

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At 0918 hours, Maruti Suzuki India was quoting at Rs 7,169.40, down Rs 165.40, or 2.26 percent on the BSE.

The share touched a 52-week high of Rs 8,400 on January 13, 2021 and a 52-week low of Rs 6,301.20 on February 24, 2021. It is trading 14.65 percent below its 52-week high and 13.78 percent above its 52-week low.