Auto makers report mixed sales in first half of FY08

Driven by Maruti Suzuki India and General Motors India, passenger car sales grew by over 14 per cent in the first six months of this financial year. However, if the numbers of these two are excluded, the figure falls to seven per cent, pulled down by the declining numbers of Tata Motors and Honda Siel and stagnant sales at Hyundai Motors India.

The two-wheeler segment continued to languish as manufacturers enter the festival season, when durables sales typically attain new highs.

According to figures released today for September, Maruti Suzuki could not sustain the rapid growth it had reported in the previous month, reporting a rise of 11.4 per cent. Hyundai, however, emerged out of a declining curve.

In August, Maruti's sales grew by a staggering 24.8 per cent, thanks mainly to booming SX4 sales. With its sales growth remaining at a healthy 17.6 per cent for April-September, the company maintained its 50 per cent share of the passenger car market.

Hyundai, whose sales had declined during April-August, reported a much better 9.7 per cent growth in September. This was due to price initiatives, such as offering the Accent at a rock bottom Rs 4.99 lakh.

"Domestic sales have been good for Hyundai this month," said Arvind Saxena, vice-president (marketing and sales), Hyundai.

The other car maker making waves is General Motors. Ignited by Spark, which came to it from Daewoo, GM reported a 141 per cent increase in sales during April-September to 20,695 cars. The company also sells Aveo and Optra.

Honda Siel, whose brands include City, Civic and Accord, reported a 2.5 per cent decline in sales to 27,414 during April-September.

"Maruti has gained from new launches such as SX4 and the diesel Swift, discount schemes and marketing initiatives. However, sales may fall in the next half year as its base is very high. The company should close this financial year with 14-15 per cent growth over last year," said Vaishali Zadoo, an auto analyst with Angel Broking.

"Tata Motors and Hyundai have lagged in terms of product portfolio. However, with new products due from both, they should be aiming at 10-12 per cent growth in the next six months," Zadoo said.

Mahindra & Mahindra, which entered the passenger car segment with Logan in collaboration with Renault of France, sold 12,494 units of the sedan during April-September. The overall sales of the company, including those of utility vehicles Scorpio and Bolero, grew by 22.33 per cent to 90,592 units.

The news from the two-wheeler industry continues to be bad. The sales of the three major manufacturers - Hero Honda, Bajaj Auto and TVS - fell 9.55 per cent during April-September. Hero Honda reported an 8 per cent fall, Bajaj 14 per cent and TVS 20.65 per cent.

Bajaj Managing Director Rajiv Bajaj expressed the hope that the company would show growth in the second half of this financial year and an improved operating margin.