After clocking strong double-digit growth numbers over the past year, automobile sales in the domestic market moderated to 13 per cent more last month. Nine of the country’s leading car manufacturers reported offtake of 187,933 vehicles in April as against the 166,221 units sold by them during the corresponding period last year.
Maruti Suzuki India Ltd (MSIL), Hyundai Motor India Ltd (HMIL) and Tata Motors — together accounting for 73 per cent of passenger vehicles sold in the domestic market — grew at eight per cent during the month. The growth was largely driven by smaller manufacturers such as Mahindra & Mahindra, Volkswagen, Toyota and Skoda.
MSIL had, for the time in over a year, registered single-digit growth of 8.9 per cent in domestic sales, at 87,144 units. The company reported average sales of a little over 100,000 units in the domestic market over the past three months. Exports, too, continued to be an area of concern for it, declining for the seventh consecutive month to 10,011 units. This is a dip of 23 per cent over April last year.
Abdul Majeed, leader, automotive practice, PricewaterhouseCoopers, said: “With a hike interest rates, liquidity is getting squeezed. Historically, it has been noticed automobile sales are lowest in April, on account of strong sales in March. Growth rates have thus moderated in the industry.”
HMIL sold 31,636 units last month, a rise of 11 per cent compared to 28,501 vehicles sold in April 2010. Exports, however, fell 13 per cent to 20,422 units, dragging down overall volumes. HMIL reported a marginal increase of 0.1 per cent in total sales last month, at 52,058 units.
| GROWING NUMBERS | |||
| Company | Apr-10 | Apr-11 | % Increase |
| Maruti Suzuki | 80,034 | 87,144 | 8.9 |
| Hyundai | 28,501 | 31,636 | 11 |
| Tata Motors | 24,899 | 25,436 | 2.2 |
| Mahindra & Mahindra | 12,923 | 15,459 | 20 |
| Ford | 7,509 | 7,319 | -2.5 |
| Volkswagen | 1,489 | 7,000 | 370 |
| Toyota | 6,003 | 9,681 | 61 |
| Honda Siel | 3,578 | 2,012 | -43.76 |
| Skoda | 1,285 | 2,246 | 90 |
| TOTAL | 166,221 | 187,933 | 13 |
“Rising interest rates have led to reduced enquires and the conversion rate, too, has slowed. We expect the trend to continue in the coming months”, said Arvind Saxena, director (marketing & sales), HMIL.
Tata Motors’ domestic sales grew marginally by 2.2 per cent to 25,436 units. Sales of the small car, Nano, touched a record high at 10,012 units. Sales of Indica declined 53 per cent to 4,250 units, while Indigo sales dropped 27 per cent to 5,282 units.
Toyota Kirloskar Motor (TKM) posted growth of 61 per cent in sales at 9,681 units, on the back of the Etios sedan, which sold 4,657 units during the month. Sandeep Singh, deputy managing director (marketing), TKM, said: “We incurred a loss of approximately 2,900 units in April due to production adjustment. However, the actual impact of the temporary production adjustment will be felt in the month of May, as we will operate at 30 per cent of our normal capacity.” TKM had announced a cut in production in April due to constraints in supply of components from Japan, which was hit by an earthquake in March.
For Honda Siel, sales fell sharply by 43 per cent to 2,012 units in April. “As announced earlier, the Japan issue prompted us to reduce production at our Greater Noida plant by 50 per cent from this month. However, production adjustments for a smooth transition began from mid-April. Further, to ensure continuity of supplies to our customers in the coming months, we have moderated our wholesale dispatches. We are hoping that supplies will normalise post-July and we would be able to catch up on the lost volumes”, said Jnaneswar Sen, senior vice-president (sales & marketing).
Mahindra & Mahindra passenger vehicle sales grew 20 per cent to 15,459 units as compared to 12,923 units in April last year.
Two-wheelers’ sales zoom
Hero Honda, the country's biggest motorcycle manufacturer, today beat all its previous sales records to post a 39 per cent growth in April. The company sold 517,099 units of two-wheelers as against 371,652 units in the same month a year ago.
The company, which sold 15 models and an automatic scooter, marked a flat growth of 0.24 per cent in March when it had posted 515,852 units in sales.
A significant portion of Hero Honda's production is sold in the domestic market. While separate numbers of export were not shared for April, it constituted 2.2 per cent of overall sales last month.
The growth in April comes on the back of a slowdown in demand for automobiles, which manufacturers have reported in the past few weeks due to rise in vehicle prices and increased cost of lending by banks.
Bajaj Auto, India's second biggest manufacturer of two-wheelers, posted overall growth of 17 per cent in motorcycle sales (including exports), at 322,235 units during the reporting month as compared to 276,095 units sold in the same month last year. However, growth in sales in the domestic market stood at five per cent, less than what the company had expected, according to managing director Rajiv Bajaj who said so to a television channel.
The company did not share figures for the domestic market separately. About 20 per cent of total sales of Bajaj Auto came from exports last month.
Honda Motorcycle and Scooter India (HMSI), the country's fourth biggest two-wheeler maker, posted a slight fall in sales at 136,623 units, a drop of 0.17 per cent as against 136,862 units sold in the same month a year earlier. "HMSI could not grow because we touched peak production capacity. HMSI is preparing for its second factory that will be operational by the end of the first-half of the calendar year," the company clarified.
Mahindra Two Wheelers of the Mahindra & Mahindra group, posted a six per cent growth in sales in April at 9,558 units as against 9,009 units earlier. The company is preparing to relaunch the Stallio motorcycle in June after it was pulled out of showrooms following problems with its gearbox. The company presently sells four automatic scooter models.
