Maruti Suzuki shares fall as e-Vitara launch faces delay, production target trimmed

Despite the dip, the stock remains up 11 percent so far in 2025.

Shares of Maruti Suzuki slipped 1 percent to Rs 12,427 on June 11 after the company's electric pivot is encountering early roadblocks, with the launch of its much-anticipated e-Vitara likely to be pushed back, CNBC TV-18 reported, citing sources. This comes after China tightened export controls on these magnets, a move seen as part of its strategic counter to US-led trade pressure under Donald Trump's administration.

India’s largest carmaker has dialled down its electric vehicle production goals for FY26, slashing the target from 88,000 units to 67,000 units, sources said. The initial target of rolling out 26,500 EVs by September this year has also been sharply reduced to just 8,200 units, the report added.

Despite the setback, Maruti Suzuki expects production to pick up pace starting October, with hopes of achieving the revised full-year target intact. While production is underway, volumes remain limited for now.

The e-Vitara, which marks Maruti’s first foray into electric SUVs, was initially set to debut in overseas markets such as Japan and Europe before hitting Indian roads. The delay in the domestic rollout could impact the company’s broader electrification strategy in the short term, but long-term plans remain unchanged, according to sources.

Maruti isn't the first OEM to flag concerns regarding rare earth magnets. Two-wheeler majors such as Bajaj Auto and TVS Motor Company have warned that production could come to a grinding halt as early as next month.

"With China accounting for nearly 90 percent of global magnet output, finding substitutes is neither easy nor quick. Alternatives from Malaysia, Vietnam, or Australia lack both scale and cost competitiveness. Testing and validation of new sources could take years," Shrirdhar Kallani of Axis Securities told Moneycontrol.

Earlier this week, Commerce Minister Piyush Goyal, while speaking in Bern, Switzerland, said that the Indian government is actively exploring alternatives, including diplomatic efforts and the development of new supply chains. According to Goyal, the Indian embassy is already in discussions with Chinese authorities on the matter, and the commerce ministry is engaged as well.

At about 9:45 am, Maruti Suzuki shares were trading at Rs 12,485, lower by 0.3 percent from the last close. Despite the dip, the stock remains up 11 percent so far in 2025.