Motoring troubles: Auto exports lose speed

Could see flat growth after years of expansion

India’s car exports, which accounts for almost one-fifth of the industry’s sales volume, could see its first decline or flat performance in six years. Exports have witnessed a fall of 4 per cent in the April-October period, pulled down by a double-digit decline in shipments of key exporters Hyundai and Nissan and a flat show by Maruti Suzuki. 

India exported a record 758,830 units of passenger vehicles (cars, vans and utility vehicles) during FY17, a 16 per cent growth over the previous year. However, in the first seven months of FY18 exports are down to 416,602 units against 15 per cent growth in the corresponding period the previous year. 

Korean carmaker Hyundai, second-biggest exporter of passenger vehicles, has registered a decline of around 18 per cent in shipments to 83,076 units during the period. Its domestic sales, much bigger in size, has grown over 4 per cent. 

“Export markets in Africa, West Asia and Latin America have seen growth challenges due to subdued energy prices. Changes in regulatory norms have also impacted the demand. At Hyundai, domestic market remains a top priority while we continue to seek avenues to export,” said Rakesh Srivastava, director (sales and marketing).

Nissan, another key exporter, has clocked a decline of 40 per cent in export during the April-October period to 35,891 units. It is learnt the Japanese carmaker has shifted production of a large volume of its Micra car to one of the European plant. The Micras produced there would cater to demand in local markets. 

Accordingly, export of Micra has dipped 65 per cent to 13,599 units in the first half of FY18. “Micra was exported to more than a 100 countries and received tremendous response from the UK, Germany, Switzerland and Italy. The shift of some production worldwide is consistent with Nissan’s global optimised sourcing strategy,” said Jerome Saigot, managing director, Nissan India Ford, the biggest exporter of passenger vehicles after overtaking Hyundai this year, has posted a decline in exports for three consecutive months (August, September and October). However, its April-October volume is still positive, with growth of over 5 per cent to 93,162 vehicles. A company official said it had faced disruption in supply of certain key components and that upset production plans. The run-up to the launch of their new EcoSport also caused some challenges. The executive said the company was well placed to grow exports. 

The country’s biggest automaker, Maruti Suzuki, which is also the third-biggest exporter, has kept export volume at an average of 10,000 units a month for over a year. 

Customers in the domestic market, which contribute 93 per cent of the sales, are on a waiting period for at least three models, making export a smaller priority for Maruti. Volkswagen and General Motors (GM) continue to report a growth. Volkswagen has increased exports by 9 per cent to 56,481 units, while GM has seen a surge of 41 per cent to 51,738 vehicles.