Will have 10 days' dealer stock by year-end: Maruti Chairman R C Bhargava

Currently, Maruti dealers hold inventory for 38 days

Maruti Suzuki India (MSIL) dealers currently hold roughly 38 days of inventory in anticipation of the upcoming festival season. However, this is expected to drop to just 10 days by the end of the year, according to Chairman R C Bhargava on Thursday.

Speaking at the company’s annual general meeting, Bhargava also indicated that demand for small cars — hatchbacks and sedans — is likely to revive by March 2026.

“Let me assure you that Maruti’s inventory with dealers is nowhere near what’s being said — claims of two months stock and so on. Our stock in the pipeline is around 38 days. We do have a slightly higher stock at this time due to the upcoming festival season. By the end of this year, the stock with dealers will likely drop to about 10 days. So, nothing special,” he remarked.

 

As car demand slows across India, dealer stock levels have surged to alarming levels industry-wide. The situation has become critical, prompting the Federation of Automobile Dealers Associations (Fada) to write to the Society of Indian Automobile Manufacturers (Siam) twice in recent months, urging action on the matter.

According to Fada, its members are currently holding around 730,000 units — enough for over two months of sales. Siam, on the other hand, estimates dealer stock at around 400,000 units.

“We do expect demand to revive. The country still needs small cars, and we’re waiting. By the end of 2025-26, this segment should make a comeback. We firmly believe that low-cost, small cars are essential in our economic and social context. A temporary setback in demand won’t alter our strategy,” Bhargava said.

Fada reports that around 920,047 cars were sold in India during the first quarter of 2024-25, marking a modest year-on-year growth of 2.53 per cent.

Bhargava also mentioned a “slight delay” in finalising the site for a new facility capable of producing 1 million units per year.

“Our programmes are expanding, and production is proceeding on schedule. Cars produced at the Kharkhoda plant (in Haryana’s Sonipat district) will boost our sales in 2025-26. There has been a minor delay in finalising the site for a new 1 million-unit expansion, but we’re working to arrive at a quick decision,” he said.

He also commented that the adoption of electric vehicles (EVs) will be “gradual” and stressed the importance of promoting other green technologies, such as hybrids, compressed natural gas, biogas, and ethanol, in the meantime.

“The role of hybrid cars is obvious. I’ve repeated this often — hybrid cars are not in conflict with electric cars. They’re essential for reducing pollution and oil consumption in non-electric vehicles. There’s a vast market for every electric car produced that meets customer needs,” he said.

MSIL’s first electric car will be launched in the coming months, Bhargava added. Initial batches will be exported to Japan and Europe before being introduced to the Indian market.

“Electric cars are a priority not just for MSIL but for other companies as well. By 2030-31, we aim to have six electric cars in our portfolio,” he said.

Bhargava identified the high cost of battery technology — comprising 40 per cent of the total cost of the car — as the biggest hurdle for EVs. He stressed the need for considerable reductions in battery costs.

As India strives for carbon neutrality by 2070, automotive makers are divided on the best way forward.

Japanese manufacturers like Suzuki, Toyota, and Honda advocate for tax cuts on hybrids, arguing that EVs alone cannot shoulder the burden of reducing emissions.

Meanwhile, companies like Tata Motors, Hyundai, Kia, and Mahindra & Mahindra insist that only full-scale EV adoption can truly decarbonise India’s roads. While petrol and hybrid cars currently fall under the 28 per cent goods and services tax slab, electric cars are taxed at just 5 per cent.