Responding to the decline in petrol car sales due to a net hike of Rs 5.54 per liter in petrol price in May 2012, India’s largest car manufacturer Maruti Suzuki has reduced the production of petrol cars and is instead focusing on increasing the production of diesel car models in its portfolio.
The sales in the small car volume segment of Maruti Suzuki with car models such as the Alto, the WagonR, the A-Star and the M800 has been hit most significantly due to the hike in petrol price due to the absence of diesel options. The customers are turning to diesel powered car models in spite of the premium pricing of such car models due to the lower running cost of diesel which is cheaper by Rs 30 per liter in comparison to petrol.
According to an official of Maruti Suzuki, about 80 percent of the new bookings by customers are for diesel car models of the company. The low demand for the petrol models compelled the company to shut down production at its Gurgaon facility for 3 days in the beginning of the month of June 2012.