Maruti Suzuki India (MSI), the country’s largest car maker, reported a 39 per cent drop in consolidated net profit for the second quarter ended September 30, hit by a sales slowdown in the industry. The fall in quarterly profit was the steepest in eight years.

The company posted a consolidated net profit of Rs 1,391.1 crore in the second quarter compared with Rs 2,280.2 crore in the year-ago period.

The last time the company saw a bigger decline in net profit was in the second quarter of 2011-12 when it posted a net profit of Rs 241 crore, down 56 per cent from Rs 549 crore in the year-ago period.

Revenue from operations in the second quarter stood at Rs 16,123.2 crore against Rs 21,553.7 crore in the year-ago period, down 25.19 per cent.

Sales during the quarter stood at 3,38,317 units compared with the same period last fiscal, down 30.2 per cent.

MSI chairman R.C. Bhargava said: “The results of the second quarter and the first half of the fiscal are substantially lower than the last year. The sales have dropped 22 per cent (in Q2) as a result of that everything has dropped.”

The auto industry has been affected by affordability issue as the cost of owning a car escalated on account of new safety and emission regulations, besides the hike in insurance and registration charges, he said.

“This got compounded by lower availability of finance for inventory and buying cars, along with increased down-payment requirement,” Bhargava said, adding banks were yet to fully transfer the benefit of the repo rate cut by the RBI to consumers.

EV plans

Maruti will not commercially launch an electric car, which it has been testing, for personal use next year, citing lack of infrastructure and government support.

The company, which had announced plans to launch an electric car based on the WagonR by 2020, said by next year the vehicle would be “at a stage which can go to the next stage of trials and testing”.