Mahindra & Mahindra (M&M) has said that it will idle production at its automotive plants for up to six days in the coming months, reports the Financial Express. M&M stated, "...As part of aligning its production with sales requirements, [M&M] would be observing no production days at its automotive plants for a period ranging from zero to six days in the forthcoming months." The announcement covers its fully owned Mahindra Vehicle Manufacturers Limited (MVML) unit as well, which will idle its Chakan plant for a similar duration.
Significance: M&M observed similar non-production days last month for one to eight days to match supply with market demand. The automaker has a portfolio that is highly skewed in favour of utility vehicles (UVs) – a factor that helped it to outperform the overall market in earlier months of this year. However, the government's move to increase excise duty by 3% on certain sport utility vehicles (SUVs), along with a narrowing gap between the prices of diesel and gasoline (petrol) fuel, has affected M&M's performance to the point where it is now underperforming the Indian passenger car market. Preliminary data for July suggested that M&M's vehicle sales declined 21% year-on-year (y/y) to 37,096 units, with its passenger vehicle sales, which include UVs and the Verito car, falling by 29%y/y to 15,530 units. It registered a similar decline in June, when its passenger vehicle sales fell by 11.2% y/y to 19,944 units
