Top Indian car maker Maruti Suzuki expects September vehicle sales to rise an annual 32 to 33%, bolstered by robust domestic demand, its chairman said on Thursday.RC Bhargava said the company, 54.2% owned by Japan's Suzuki Motor, expects to sell 1.2 million vehicles in the current fiscal year that ends next March from 1.02 million in the previous year.
India is one of the world's fastest growing market for cars as a rapidly expanding economy boosts incomes and consumer spending.
"Clearly, the market continues to hold firm. There is no softening," Bhargava said. "We are now looking fairly optimistically at the rest of the year."
Beginning October, Maruti will increase its annual car-making capacity to 1.3 million units from its current capacity of 1.2 million units, he said.
Maruti plans to invest USD 1.3 billion over the next three years on manufacturing plants to boost capacity, it had said earlier this month.
The company would build its fourth auto plant in India, boosting its output to 1.5 million units a year. The new factory would start operations in 2013, with annual output capacity of 250,000 cars.
Bhargava said September sales would be higher than in August, when they rose 24% from a year earlier to a record for any month.
Maruti's share of the Indian car market at the end of August was 51.8%, he said. This is down from 53.2% in the previous fiscal year and 55.1% in 2008/09.
"We are not focused fundamentally on retaining market share. It's not a worry because we know we have capacity constraints, we have a waiting list," Bhargava said. He also said Japan's Nissan Motor Corp would source less than 30,000 cars this fiscal year from Maruti, compared with 51,072 cars last fiscal year, primarily due to a decline in European demand.
Maruti currently has a contract with Nissan to make and export the Pixo hatchback to European markets.
Shares in Maruti, which has a market value of USD 9.2 billion, were trading up 1% by RS 1,445 at 2.29 pm (0859 GMT) in a subdued Mumbai market. The stock is, however, down 7.4% this year versus a 14% rise in the index.
