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Demonetisation Effect: Indian Auto Industry Cuts Production
“In general terms, our production always follows anticipated market development, which we are currently observing with special scrutiny.”
Car
and
truck
manufacturers
are
about
to
slash
production
as
demonetisation
led
to
a
massive
in
sales
and
hit
footfalls
at
showrooms.
The
government
announced
the
demonetisation
of
Rs
500
and
Rs
1000
on
November
8.
Due to this announcement of the demonetisation of high-value currencies, the demand for automobiles has been dropped. In some cases, the drop is a significant 65 percent. This impact is forcing automotive companies to cut down production or introduce block leave (no production days).
According to a report, Daimler AG has gone in for a block leave for three days last week. The company also has planned to do the same this week also. Others like Renault and Nissan is stopping production of cars on the third shift in Oragadam factories.
Erich Nesselhauf, Daimler India Commercial Vehicles told TOI, "As a matter of principle at Daimler worldwide, we do not publicly discuss our production planning.
"In general terms, our production always follows anticipated market development, which we are currently observing with special scrutiny."
Renault and Nissan's officials said that they have announced the stopping of third shift for this week. Sources said, "While we have termed it internally for maintenance, you can derive if maintenance work happens at factories only for the night shift."
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