Auto Slowdown: Maruti Suzuki cuts temporary workforce by 6% as sales sink

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26 Aug, 2025 12:21

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The slowdown in auto sector is starting to hurt the industry as country’s largest automaker, Maruti Suzuki India Ltd slashed its temporary workforce by 6 percent to tackle muted sale and piling up of inventory according to a Reuters’ report.

The company had reported 34 percent drop in July sales at 1.09 lakh unit compared to 1.64 lakh unit sold in the same period a year-ago. The overall July passenger vehicle is estimated to decline between 27-31 percent as compared to last year, rating agency CRISIL said in a note.

The agency further said that August sales are likely to remain dull due to weak retail sentiment and OEM effort to maintain inventory level.

Auto part makers’ body Automotive Component Manufacturers Association of India (ACMA) earlier warned that one million workers out of total five million could lose employment if the slowdown in the sector persists.

Maruti has cut vehicle productions for five consecutive months from February to June to manage inventory level.

The company said it employed 18,845 temporary workers on average during the six months ended June 30, down 6%, or 1,181 people, from the same period last year, adding that job cuts had accelerated since April.

It is the first time the reduction has been reported. The listed company doesn't have to disclose reductions in temporary workers.

Maruti Suzuki, majority-owned by Japan's Suzuki Motor Corp, said it had not reduced its permanent workforce -- which numbered 15,892 at the end of March -- over the past year but declined to say whether further reductions were planned.

It said previously that it had cut production by 10.3% in the first six months of the year.

Maruti Suzuki, which produces about one in two of the passenger vehicles sold in Asia's third-largest economy, on Thursday reported a 33.5% decline in sales in July to 109,265 vehicles compared with July 2018.

(With input from Reuters)