Auto Industry Starts the New Year with a Flourish

Indian automobile industry commenced the innings in the year 2007 with a bang, clocking impressive double-digit growth across all segments and accelerating the growth momentum. With sales hitting new peaks, passenger vehicle segment finished with a growth of 23%, while commercial vehicles, 3-wheelers and two wheelers moved their sales curve up by 36%, 34% and 11%, respectively, in January 2007.

Car market leader Maruti Udyog Limited recorded highest ever monthly sales with a tally of 62,248 vehicles in the domestic market in January 2007 and witnessing a growth of 28.3 per cent over corresponding month last year. The previous highest was 61,141 vehicles in March 2006 (Post budget). In all, Maruti Udyog sold 65,341 vehicles in January 2007 including 3093 vehicles of exports.

In A2 segment, the company sold a record 44,736 vehicles in January 2007, which reflects a 41.8 per cent growth over sales in January 2006. The previous highest was 38,940 vehicles in October 2006. In C segment, the sales grew by 40.8 per cent compared to sales in January 2006. Maruti 800, however, saw its sales declining by 15%, so also the A3 segment comprising Baleno & Esteem.

Hyundai Motor India Ltd (HMIL), the country's second largest car manufacturer, had a remarkable start to the new year as it registered a 49% increase y-o-y in its domestic vehicle sales with 17,460 units for the month of January 2007. The total sales of 26,661 vehicles in January 2007 were up 33% over January 2006. The company's exports at 9,201 units clocked a growth of 11%.

HMIL's sales in January 2007 have been the highest in the month of January till date, with Santro - the flagship car from the Hyundai stable, clocking a domestic sales growth of 78% in comparison to January 2006. The segment-wise cumulative sales in the month of January 2007 are as follows: A2 Segment - 23,792 units; A3 Segment - 2730 units; A4 Segment - 70 units; A5 segment - 61 units; and SUV Segment - 8 units.

Ford India sold 4,623 units in domestic market in the month of January 2007 as against sales of 5,173 units in January 2006. The exports, however, rose to 2,094 units from 1,717 units a year ago. Though Ford India sold a tad less number of vehicles in January 2007 compared to sales in January 2006, this was the third best monthly sales performance for the company. Previously, the company had posted record domestic sales in March 2006 and January 2006 with 5,929 units and 5,173 units respectively. For the period Jan-Dec'06, Ford India posted an overall growth of 87%.

 
General Motors India registered a healthy 46% growth in its sales with a tally of 3,776 units in January 2007 as compared to 2,592 units a year earlier. The January 2007 sales comprise of 2,111 units of Chevrolet Tavera, 1421 units of Chevrolet Aveo/U- VA & 244 units of Chevrolet Optra.

Honda Siel Cars India witnessed an impressive growth of 31.3% in sales volume in January 2007. HSCI sold 6,013 cars during the month as compared with sales figure of 4,578 cars in January 2006. Modelwise break-up for January 2007: City - 3,617 units; Civic - 1,776 units; Accord - 393 units; and CRV - 227 units.

The cumulative sales of the company for the period April 2006 - January 2007 increased to 49,312 units, a notable jump from 34,412 units during the corresponding period last year. This reflects a growth of 43.29%.

The month of January 2007 also saw HSCI being conferred 17 awards in various categories including several awards for its recently launched models - Civic and CR-V in 2006.

M&M's domestic & overseas sales of utility vehicles aggregating 10,984 units in January 2007 rose 14.3% from 9,611 units in January 2006.

Tata Motors reported a total sale of 55,440 vehicles (including exports) in the month of January 2007, a growth of 19% over 46,635 vehicles sold in January last year. Cumulative sales (domestic + exports) of TML at 462,892 units in FY 2007 have grown by 31 % over April 2005 -January 2006.

The company's passenger vehicle business logged total sales of 22,801 vehicles in the domestic market in January 2007, up 10% over January 2006. The Indica reported its highest ever monthly sales since launch, at 14,466 units, growing by 14% y-o-y. The Indigo family witnessed sales of 3207 units, recording a decline of 17% over the same month last year. The recently launched Indigo XL has been well received in the market and its production is being increased, according to TML release. The Sumo and Safari accounted for sales of 5,128 units, clocking a growth of 20%, with Safari reporting highest ever sales for any month since its launch.

The company's sales of commercial vehicles in January 2007 in the domestic market numbered 28,896 units, up 36% over 21,301 vehicles sold in January last year. M&HCV and LCV sales at 17,097 units and 11,799 units, clocked growth of 31 % and 44%, respectively over January 2006.

TML exported 3,743 vehicles in January 2007 as compared to 4,569 vehicles in January 2006, registering a decline of 18%. The cumulative exports during April 2006 - January 2007 in the current period at 42,487 units have, however, recorded a 7% growth over the corresponding period last fiscal.

Ashok Leyland also came up with a stupendous performance with its domestic sales growing by 62% to 9,096 vehicles in January 2007 (5,618 vehicles in January 2006); exports rose by 227% to 554 units (169 units in January 2006). The company's total vehicle sales at 9,650 units grew by impressive 67%, compared to 5,787 units in Jan'06. Cumulative sales up to January 2007 in the current FY stood at 66,604 units, up 42% y-o-y. Cumulative domestic sales were up 43% to 61,770 units, while exports rose by 23% to 4,834 units.

Hero Honda Motors Ltd asserted its leadership position in 2-wheeler segment with a vengeance clocking a sales growth of 19% to 297,554 units in January 2007 from 249,450 units a year ago. HHML's exports, however, witnessed a massive fall from 6,476 units in January 2006 to 2,706 units in January 2007. Although Hero Honda has remained undisputed leader in Indian two-wheeler industry for over five years now, Bajaj Auto came perilously close to it in terms of sales numbers in one of the recent months. After a time gap, Hero Honda has outpaced Bajaj Auto in growth rate.

Bajaj Auto, on the other hand, sold 197,553 two-wheelers (exports included) in the month of January 2007 moving up by 9% on the growth curve over sales figure of 181,758 two-wheelers a year ago. BAL stayed on course with its excellent run on export front notching up overseas sales of 23,343 two-wheelers. Bajaj motorcycles continue to grow ahead of industry growth rate and thus gain market share. With increasingly strong sales of motorcycles from Bajaj Discover and Bajaj Pulsar DTS-i platforms, only 45% of Bajaj motorcycle sales now come from the relatively lower margin 100cc segment.

BAL's 3-wheeler sales performance also remained on high growth trajectory. The 3-wheeler sales in the month of January 2007 aggregated 32,030 units, including exports of 16,469 units, zooming by 45% over 22,019 units of sale in January 2006.

TVS Motor Company recorded a growth of 7% in total two-wheeler sales during January 2007 with a tally of 121,147 units compared to 112,910 units in January 2006.

The company's motorcycle sales in January 2007 at 69,634 units compared to 69,279 units in January 2006, remained flat. TVS Scooty clocked sales of 20,534 units in January 2007 vis-a-vis 17,957 units in the same month last year, climbing up by 14%. TVSM continued its decent export performance, with export figure of 7,049 units in January 2007, which represents a growth of 11 % y-o-y.

Auto industry is, at present, on a high growth trajectory and outlook remains bright in short and medium terms. The second cut in petroleum prices, announced recently in less than three months, should counteract the negative sentiment, if any, arising out of continuing high rate of inflation and hardening of interest rates.