Tokyo/Mumbai: India’s top automakers reported strong September sales, fuelled by the country’s robust economic growth, while car sales in Japan fell for the first time in 14 months in September after government incentives dried up.
The global auto industry’s recovery from the financial crisis has been patchy and largely reliant on growth in countries such as China and India, as well as government subsidies and incentives to revive demand.
“Overall, I am not that pessimistic about auto demand worldwide,” said Lee Sang-hyun, an analyst at NH Investment & Securities in Seoul. “Although demand in the U.S. and Europe is sluggish, sales are growing in emerging markets.”
Sales at India’s top automakers remained robust in September, up as much as 30% on a year ago and showing no signs of slowing.
But after holding up surprisingly well in August, Japanese sales, excluding 660cc minivehicles fell 4.1%, the Japan Automobile Dealers Association said on Friday.
Sales in Japan are expected to come under further pressure after the government stopped accepting applications for its green-car subsidy programme last month.
Toyota Motor Corp had been a big beneficiary of the programme, particularly with sales of its hybrid flagship Prius. But Toyota’s domestic dealership orders fell more than 40% in September after funds allocated to the cash-for-clunkers scheme were almost exhausted, the Nikkei business daily reported.
Christopher Richter, auto analyst at CLSA Asia-Pacific Markets in Tokyo, expected the pattern in Japan to be a repeat of what had happened in Germany -- a period of good sales followed by some very poor sales.
“The makers that are going to get hit the worst by this are going to be first Toyota followed by Honda because these subsidies were constructed to give the maximum subsidy to those who bought the most fuel efficient vehicles,” he said.
“When we get into the fully bad month of October probably everybody is going to be down.”
INDIA SALES GROW
With demand in developed markets lacklustre, global automakers have been increasing their focus on faster growing regions such as China, now the world’s largest auto market, and India.
Sales at Maruti Suzuki, India’s top car maker, grew almost 30% in September from a year earlier, accelerating from August.
The company, which sells one of every two cars in India, said on Thursday it expects to sell 1.2 million vehicles in the current fiscal year that ends next March, up about a fifth on last year’s sales..
“The volume growth is high because economic factors are supportive. The base effect will catch up from the next month for the major auto makers,” said Vaishali Jajoo, auto analyst at Mumbai’s Angel Broking.
“While rate of growth may taper off, in absolute numbers, I think sales will remain strong.”
India’s largest utility vehicles maker, Mahindra & Mahindra, said sales in September rose nearly 24% from a year earlier, while Tata Motors said vehicle sales, excluding those of the luxury Jaguar, Land Rover brands, increased 23% in September.
Tata Motors, the country’s biggest truck maker, separately said it is raising prices of some models to counter higher input costs.
In Korea, Hyundai Motors saw its year on year sales growth decline to just 1.8% in September from 17% August due to fewer operating days and tougher comparisons.
Hyundai, the world’s fifth largest carmaker along with its affiliate Kia Motors, benefited from Beijing’s subsidies for fuel-efficient models in China, while its Sonata sedan posted strong sales in the United States, analysts said.
Overall U.S. industry sales for September, due later on Friday, are on track to top August levels by a small margin after a boost from end-summer sales events even as economic uncertainty crimps a fuller recovery for the industry.
Sales there are seen at an annualized rate of 11.51 million versus 11.47 million in August and up sharply from a year ago when the US government-funded incentives scheme ended.