BackNew models drive auto sales in September
Auto firms remain optimistic of the road ahead, see sales gaining further traction as festive season starts
Premium
Mumbai: Car and two-wheeler sales rose for most manufacturers in September, the tenth month in a row, primarily driven by new models. With festivals like Dussehra and Diwali scheduled in October and November, auto firms expect sales to gain further traction.
Maruti Suzuki India Ltd’s domestic sales rose 6.8% to 106,083 units last month compared with a year ago. A 3.5% growth in the company’s compact car models such as Swift, Ritz, Celerio and Dzire and a 6% increase in its utility vehicle segment, in which it sells the Ertiga, Gypsy and S-Cross models, contributed to the volume growth.
Entry-level models such as Alto and Wagon R reported flat volumes at 35,570 units, compared with 35,547 units a year ago, indicating tepid buying behaviour of first-time buyers.
Purchase consideration of new launches has increased among vehicle shoppers to its highest level in three years, according to JD Power Asia Pacific, a market researcher. In 2014-15, 10% of all shoppers considered a newly launched model against 7% in 2012-2013, it said in a statement on 30 September.
Sales in September are not strictly comparable with last year as Navratra, which is a big draw for buyers, began on 25 September last year, whereas end-September this year was marked by Shraadh, considered inauspicious for big-ticket purchases, a Maruti Suzuki spokesperson said.
Auto firms remain optimistic of the road ahead and maintain that the half a percentage point rate cut by the country’s central bank, low inflation, softer fuel prices and the festivals ahead will boost sentiment and translate into better sales.
There’s likely to be a 15-20% growth in sales volumes during the festive season, according to Rakesh Shrivastava, senior vice-president-sales and marketing at Hyundai Motor India Ltd. “The biggest change is sentiments turning positive," he said. Creta, the compact sports utility vehicle (SUV) Hyundai launched on 22 July, drove the company’s sales to a record 42,505 units, up 21% over a year ago.
Hyundai sold 7,000 units of Creta during the month. There is a three-month waiting period for the vehicle. The firm has ramped up production of the model by 40% to 7,500 units a month, Shrivastava said.
But passenger vehicle sales at Mahindra and Mahindra Ltd continued their declining streak despite the TUV 300, an all-new seven-seater SUV which it launched on 10 September. Mahindra’s passenger vehicle sales dropped 7% to 19,564 units.
The TUV has “received a good response and we expect it to boost the overall demand", said Pravin Shah, president and chief executive, automotive division at Mahindra. The company is also positive about the softer interest rates on auto loans and the festive season helping sales rebound, he said.
A 4,200 unit contribution of the TUV 300 to Mahindra sales was slightly lower than expectations, said Nitesh Sharma, analyst at Phillip Capital India Pvt. Ltd, a brokerage firm. He doesn’t expect Mahindra’s volumes to come into positive terrain till the launch of the compact SUV, codenamed S101, in the fourth quarter of the current fiscal year.
Sales at Honda Cars India Ltd continued to advance at a brisk pace, aided by the Jazz, the compact car it launched in July. Honda despatched 18,509 units, an increase of 23% over last year.
Driven by the new generation Figo and the Aspire sedan launched last month, sales at Ford India Pvt. Ltd jumped 22% to 8,274 units over the last year. The new launches, said Anurag Mehrotra, executive director, sales, marketing and service, are part of the plan to launch three new models by the first quarter of 2016.
After showing signs of a recovery in the last few months. Tata Motors Ltd saw its passenger vehicle sales skid 1.7% to 11,774 units.
Hero MotoCorp Ltd, India’s largest two-wheeler maker, saw its September sales stay flat at 606,744 units. The maker of Splendor and Passion models sold 604,052 units last year, the company said in a statement on Thursday.
Honda Motorcycle and Scooter India Pvt. Ltd saw its September volumes decline 2.1% to 41,163 units. The volumes were dragged down by motorcycles.
Two-wheeler sales in India, the world’s second largest market after China, have been under pressure. In the first five months of the current fiscal year, two-wheeler sales declined 0.20% to 6,581,531 units. The volumes were mainly dragged down by motorcycles sales which fell 4.33% to 4,344,154 units, according to lobby group Society of Indian Automobile Manufacturers. The decline in motorcycle sales is because of poor demand in rural India.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
