Aditi Shah
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By Aditi Shah
NEW DELHI (Reuters) -Maruti Suzuki has cut near-term production targets for its maiden electric vehicle e-Vitara by two-thirds because of rare earths shortages, a document showed, in the latest sign of disruption to the auto industry from China's export curbs.
India's top carmaker, which said on Monday it had not seen any impact yet from the supply crisis, now plans to make about 8,200 e-Vitaras between April and September, versus an original goal of 26,500, according to a company document seen by Reuters.
It cited "supply constraints" in rare earth materials that are vital in making magnets and other components across a range of hi-tech industries.
Maruti still plans to meet its output target of 67,000 EVs for the year ending March 2026 by ramping up production in subsequent months, the document said.
China's curbs on some rare earth exports have rocked the global auto industry, with companies warning of severe supply chain disruptions. While some companies in the United States, Europe and Japan are seeing supplies easing as they secure licences from Beijing, India is still waiting for China's approval amid fears of production stoppages.
Launched amid much fanfare at India's car show in January, the e-Vitara is crucial to Maruti's EV push in the country, marking its entry in a segment that Prime Minister Narendra Modi's government wants to grow to 30% of all car sales by 2030 from about 2.5% last year.
The setback could also hurt parent Suzuki Motor, for which India is the biggest market by revenue and a global production hub for EVs. The bulk of the made-in-India e-Vitaras are earmarked for export by Suzuki to its major markets like Europe and Japan around summer 2025.
Maruti told reporters last week the rare earths issue had no "material impact" on the e-Vitara's launch timeline. Chair RC Bhargava said there was "no impact at the moment" on production, local media reported on Monday.
Maruti and Suzuki did not respond to requests for comment on Tuesday.
Maruti shares trading on the Indian stock exchange fell as much as 1.4% to the day's low after the news.
Maruti is yet to open bookings for the e-Vitara with some analysts warning it is already late to launch EVs in the world's third-largest car market where Tesla is also expected to begin sales this year.
Under its previous plan "A", Maruti was to produce 26,512 e-Vitaras between April and September - the first half of the fiscal year. Under the revised plan "B", it will manufacture 8,221, the document showed, indicating a two-thirds cut in its production schedule.
