Tata Motors on Wednesday said it has cut production in both the passenger and commercial vehicle segments in order to align its output with market demand.

“Yes, we have adjusted production of both passenger vehicles and commercial vehicles in order to align with the market demand,” Tata Motors Managing Director - India Operations Mr P M Telang told reporters on the sidelines of a summit organised by the Society of Indian Automobile Manufacturers (SIAM).

He said the production cuts would vary for different models, but did not provide specific details. “As far as the commercial vehicles are concerned, most of the cut is in the higher segment, as the light and small commercial vehicle segment is doing well,” Mr Telang said.

Commenting on the decline in consumer demand for passenger vehicles, he said: “Due to high petrol prices and inflation rate, there has been a slowdown in demand.”

Last month, the company had resumed production of passenger vehicles at its facilities in Pune and Sanand, following a temporary suspension on account of a slowdown in demand in the domestic market.

According to SIAM estimates, Tata Motors’ production of passenger vehicles declined by 21.63 per cent year-on-year to 28,344 units in July, 2011.

Commenting on declining Nano car sales, he said it was “not a concern”.

“Retail sales of Nano are good and as and when we expand further across the country, the numbers will go up gradually,” Mr Telang said, adding that wholesale numbers may fluctuate, as the company aligns production to market demand.

He also indicated that the outlook for the entire automotive industry is positive, stating: “Onset of the festive season and a good monsoon should spur growth of the sector.”

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