Suzuki operating income falls 33 per cent in Q3 on sluggish India sales

Suzuki Motor Corporation Tuesday said its operating income declined 33 per cent to 58 billion yen globally for the third quarter ended December 2018, hit by flat sales in India, its biggest market.

The Japanese major had reported an operating income of 86.9 billion yen in the October-December period of the previous fiscal.

Its operating income for the period under review declined, mainly owing to the impact of the depreciation of currencies of the emerging countries including the Indian rupee and the increase in selling expenses, the company said.

Suzuki saw its global sales decline by 0.9 per cent during the third quarter to 7.8 lakh units as compared with 7.87 lakh units a year ago.

Sales in India, which accounts for roughly half of the company's total global sales, rose marginally to 4.06 lakh units from 4.01 lakh units.

In December, its arm Maruti Suzuki India (MSI), had reduced sales forecast for the ongoing fiscal to 8 per cent from an earlier projection of double-digit growth.

The company cited low demand in the second half of the year due to high interest rates, increased insurance cost and fuel prices for its downward revision, besides its lack of new model launch in the volume segment.

MSI had reported its second successive decline in quarterly net profit with a 17.21 per cent drop for the December quarter 2018, also the steepest fall in nearly five years.

It had reported a net profit of Rs 1,489.3 crore for the October-December quarter as against Rs 1,799 crore in the same period of the previous fiscal.