M&M resorts to plant shut down to clear tractors' inventory

New Delhi: Auto major Mahindra & Mahindra on Tuesday said it will shut down its tractor plants at Jaipur and Rudrapur for five days and two days, respectively, next week due to inventory pile up amidst falling sales.

In a filing to the BSE, the Mumbai-based firm said that "as part of aligning its production with sales requirements" the company will be observing "no production days" at its tractor plants at Jaipur for five days and Rudrapur for two days.

The planned shutdown will take place between March 24 and March 31, it added.

"The management does not envisage any adverse impact on availability of tractors in the market due to adequacy of tractor stocks to serve the market requirements," Mahindra & Mahindra (M&M) said.

M&M had reported 2.97 percent decline in its total tractor sales in February this year at 14,861 units compared to 15,316 tractors in the same month of last year.

Domestic tractor sales of the company had fallen by 2.77 percent during the month at 13,944 units as against 14,341 units in February 2012. Exports last month stood at 917 units compared to 975 units in same month previous year, down 5.95 percent.

Shares of M&M on Tuesday closed 3.45 percent down at Rs 881.35 apiece on BSE.

Earlier, the country's largest car maker Maruti Suzuki India (MSI) also undertook a one day-production cut at its Gurgaon plant amid declining sales.

MSI had reported 7.89 percent decline in its total sales at 1,09,567 units in February 2013. It had sold 1,18,949 units in the corresponding month last year.

PTI