Retail in Asia

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Maruti faces capacity crunch as sales surge for India’s largest car producer

India’s largest car producer – Maruti Suzuki – has a problem. While the automaker is seeing growing demand for its cars, it does not have sufficient production capacity to match it. And this capacity constraint is not likely to be lifted before 2012.

The company, which sold over one million cars in the last financial year, expects sales to go up by around 10 percent. In simple terms, this means that its engineers have to produce over 100,000 more cars in a plant which is already working at over 100 percent capacity.

The man steering the fortunes of the company, chairman RC Bhargava, admits the problem. "We are certainly not in our comfort zone. Our engineers are stretching our production capacity through various innovations, as new capacity will not be available until 2012," he says.