BackSector Update: Automobiles
Sector Update: Automobiles
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After four consecutive months of speed breakers, in February 2009 automobile companies experienced some respite as some effects of the various economic stimulus packages combined with the rebuilt inventory improved the volumes during the month.
Further, interest rate cuts on automobile loans and the pay hikes based on the Sixth Pay Commission’s recommendations also boosted demand to some extent.
Some of the automakers have lined up new and aggressive launches in the coming months, in an attempt to fight the slackening demand.
In February 2009, the car segment outpaced the two-wheeler segment by recording a 21.8% growth in the domestic market. The two-wheeler sales grew by 16.2% in the domestic market.
The overall automobile sales volume rose by 10% with the domestic sales rising by 12.7% and exports declining by 7%.
Passenger vehicles: In February 2009, Domestic car sales reported a strong growth of 21.8% whereas that of utility vehicles (UVs) and multi-purpose vehicles
(MPVs) declined by 5.4% in the domestic markets.
Maruti Suzuki with a 54% market share in the passenger car segment improved its domestic sales by 20.6%.
Tata Motors reported a 15.4% growth in the domestic sales of its passenger cars and showed some recovery with the monthly volume resembling its highest sales in the segment for the current fiscal.
Commercial vehicles: The commercial vehicle (CV) sales continued to decline, but at a slower pace of 16.7% when compared with the previous months.
The performance of the medium and heavy commercial vehicles (M&HCVs) continued to be sluggish despite various stimulus packages while the better performance of the light commercial vehicles (LCVs) softened the overall impact.
The M&HCV sub-segment declined by 51.4% in the domestic market whereas the LCV subsegment dropped by 3.7% in the domestic market, showing some signs of a revival.
Two-wheelers: Two-wheeler sales picked up in February 2009 with a growth of 16.2% in the domestic market.
Hero Honda Motors (Hero Honda) rendered a strong performance with its two-wheeler sales (including exports) grew by 24%.
Bajaj Auto’s two-wheeler sales (including exports) declined 17%, causing the company to lose a major chunk of its market share. TVS Motors also reported a 12.7% growth in its two-wheeler sales (including exports).
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