Toyota Kirloskar June sales down 64% YoY

Mumbai: Toyota Kirloskar Motor Pvt Ltd (TKM) has sold a total of 3,866 units in June, down 64% year-on-year, the company said on Wednesday .

The company's sales, however, recovered month-on-month as it dispatched 1,639 units in May as more dealerships opened up to deliver pending orders and accept new bookings.

“With lockdown regulations being relaxed in several parts of the country and with demand picking up in the market, Toyota dealers were able to mostly sell vehicles to customers from their held inventory in May 2020 thereby ensuring a lean inventory at the dealership by the beginning of June,” the company said in a note.

The maker of Fortuner and Innova utility vehicles had resumed operations in a phased manner at its manufacturing plants in Bidadi near Bengaluru from May 26 after remaining shut for more than two months. By the time it had resumed operations at its plants, the company had managed to have more than 290 dealerships and 230 service outlets open up to work on the order book.

On 16 June, the company reported two covid-19 positive cases at its plant, which resulted in a temporary shutdown again to execute disinfection processes in the facility.

However, it said retail momentum in June has resulted in 50% reduction in dealers’ inventory costs when compared to the same a year ago and that has resulted in achieving efficiency in dealer operations.

“Our retails is nearly double of wholesales (sales from company to dealers) second month in a row thereby bringing down our dealers inventory carrying cost by more than 50% over the past two months. We are also seeing a visible growth in online enquiries as well as bookings,” said Naveen Soni, senior vice president, sales and service, TKM, adding that special financing offers and buy back offers are pulling customers back to the dealerships.

Soni also said, post covid-19, the market is showing initial signs of shift towards entry-level variants across all models and the company would adjust its production schedules for the models in demand accordingly. He added that the company is following the ‘Toyota Pull System’, which is a pre-defined process to supply vehicles to dealers based on the market demand.