Festivals Add Fervour to Auto Market

There is no stopping the growth trajectory of auto market. Vehicle sales continued to surge in October, when the domestic sales rose by a healthy 46%. It was the fourth consecutive month of record sales of passenger vehicles and two-wheelers. While commercial vehicles' growth moderated after clocking the best ever figures in September, 3-wheelers saw highest ever-monthly sales in Oct'10. The CV sales numbers may not be reflective of the situation on ground. It was essentially a capacity constraint at manufacturers' end, due to the implementation of BS III emission standards from 1st Oct'10 in the entire country except for 13 cities where BS IV norms have already come into force from 1st Apr'10.

Bucking the not-so-good industrial output numbers in September, which saw IIP growth slowing down to 4.4%, vehicle sales soared to a new high in the fourth month running, on the back of a slew of new launches, fast recovering economy leading to rising disposable incomes & consumer confidence, and flexible finance availability & continuing soft interest rates in spite of marginal increase.

Setting the pace, Passenger vehicles were in overdrive with domestic sales zooming 38% to 231,957 units in Oct'10, bettering their best in September and surpassing the 2-lakh-unit mark in the 4th successive month. Barring a blip in June, passenger vehicles have been witnessing new highs in sales ever since the advent of this financial year.

Two-wheelers also hit the sweet spot clocking over 50% growth in domestic sales in Oct'10 at 1,127,827 units, which was again a new record for the 4th month in a row. It was refreshing to see scooters staging a comeback with a bang, as the domestic sales vaulted by a whopping 104% to 1,88,633 units. Robust demand of scooters, which continues to grow steadily, has resulted into some of the popular scooter models witnessing a waiting period of 2-4 months, as two-wheeler manufacturers make frantic efforts to expand capacity and ramp up production due to sudden burst in demand.

India's car market leader Maruti Suzuki India Ltd (MSIL) sold a total of 118,908 vehicles in Oct'10, growing 39.2 per cent over the corresponding sales tally of 85,415 vehicles in Oct'09. This included 11,353 units of exports, which incidentally witnessed a decline of 18.1 % from 13,864 units exported in October last year. The passenger vehicles, in general, have been witnessing fall in export numbers due to slow recovery and uncertainty in Europe.

The month of October saw Maruti Suzuki establish a number of new sales records. It was for the first time that Maruti Suzuki crossed 1-lakh-unit sales-mark in the domestic market in Oct'10, clocking 107,555 units. The previous highest domestic sales at 95,148 units were recorded in Sep'10. October 2010 also marked 3 consecutive months of over 1-lakh-unit in total sales for the company. The month was also special for the company inasmuch as it posted the highest ever sales numbers in all large volume segments, viz: A2 segment - 77,502 (previous highest 68,921 units in Sep'10); A3 segment -11,621 (previous highest 10,883 units in May'10); and C segment -15,379 (previous highest 14,157 units in Aug'10).

The company's sales volume in A2 segment grew by 50.7 per cent, while in the A3 segment, the sales climbed up by 32 per cent, as compared to Oct'09. The sales growth in C segment was 91.8 per cent; and in B segment, 151.2 per cent y-o-y.

 
The month also witnessed a record of sorts for Hyundai Motor India (HMIL), the country's second largest car manufacturer and the largest passenger car exporter. The company recorded sales of 34,725 units in the domestic market in Oct'10, which is the highest ever since the company started sales in Sep'98. This is also the first time that HMIL in the last four consecutive months has achieved over 50,000 units of total sales including exports.

HMIL's total sales for Oct’10 stood at 52,225 units as against 51,735 units in Oct'09, registering a paltry increase of 0.9%. The domestic sales during the month increased by 22.7% to 34,725 units as against 28,301 units a year ago, while the exports dipped by 25.3% from 23,434 units in Oct'09 to 17,500 units in Oct'10.

The segment-wise cumulative sales of HMIL during the month of Oct'10 were as follows: A2 segment (Santro, i10 & i20) -46,399 units; A3 Segment (Accent & Verna) 5,730 units; A5 segment (Sonata Transform) - 22 units; and Santa Fe (SUV) - 74 units.

Riding on the good sales numbers of its small cars - Chevrolet Beat and Spark, General Motors India (GMI) posted an impressive growth of 36% in sales during Oct'10, compared to Oct'09. The company sold 10,051 units in Oct'10 vis-à-vis 7,413 units in Oct'09. This was the first time that GMI was able to cross 10,000-unit sales-mark.

GMI's Oct'10 sales volume comprised 3,251 units of the Spark, 3,021 units of Beat, 1,594 units of Tavera, 957 units of Cruze, 405 Units of Aveo, 328 units of Aveo U-VA, 333 units of Optra and 162 units of Captiva.

Ford India was another company that came up with a stellar performance, notching up 9,737 units of total sales during the month of Oct' 10 that saw the company's domestic sales at 9,026 units rising by a staggering 161% and exports at 711 units by 206.5% y-o-y.

Honda Siel Cars India (HSCI) sold 5,275 units during the month of Oct'10 as against 6,909 units during the corresponding month last year, which was somewhat out of tune with the impressive growth of PV segment.

Staying on course, Tata Motors posted total sales of 64,757 commercial and passenger vehicles (including exports) during Oct'10 growing by 21 % over 53,404 vehicles sold in Oct'09. The company's domestic sales of commercial and passenger vehicles during Oct'10 stood at 58,807 units, a 16% growth over 50,552 units sold in October last year.

Domestic sales of Tata commercial vehicles in Oct'10 added up to 34,329 units, a 12% rise over 30,541 units sold a year back. While LCV sales climbed up by 11% to 20,689 units, M&HCV sales at 13,640 units were up 14% y-o-y.

Passenger Vehicles Business Unit of Tata Motors reported sales of 24,958 units in the domestic market during Oct'10, which represents a growth of 22.8% over Oct'09. Sales of the Tata Nano were higher by 2% at 3,065 units, while Indica range sales at 9,732 units grew by 1% over October last year. The Indigo range recorded sales of 8,292 units, a 69% increase y-o-y. The Sumo/ Safari/Aria range accounted for 3,389 units of sales, which was higher by 38% y-o-y.

The company's exports totalling 5,950 vehicles in Oct'10 registered a growth of 109% compared to 2,852 vehicles exported in October last year. The cumulative YTD exports for the fiscal at 32,648 units are higher by 103% over 16,075 units in the same period last year.

UV major Mahindra & Mahindra (M&M) was also in the fast lane, selling 16,061 utility vehicles in domestic market during Oct'10, which translated into a decent growth of 22.5%. M&M also turned in a fairly good performance in commercial vehicle and 3-wheeler segments, posting 32.2% and 26.7% growth, respectively, in their domestic sales.

Ashok Leyland's total vehicle sales during Oct'10 aggregated 5,732 units, witnessing a growth of 8%. The company registered a staggering 177% growth in exports at 1,104 vehicles. However, domestic sales were down 6% y-o-y at 4,628 units, due largely to the supply crunch arising from the implementation of BS III norms.

Sales of two-wheelers remained robust with an all-time high monthly sales of 11.28 lakh units in domestic market during Oct'10.

Cashing in on the festive season and buoyant market, Hero Honda Motors Ltd (HHML), the world's largest two-wheeler manufacturer raised the bar further and came up with another first in the industry, recording over 5-lakh units of sales in Oct'10. The company's domestic sales aggregating 4,91,356 units and exports at 14,197 units zoomed by staggering 42.5% and 51.2%, respectively.

Bajaj Auto too put up an impressive show with the highest-ever domestic sales of two-wheelers in a month. Domestic sales volume of Bajaj two-wheelers adding up to 239,936 units grew by handsome 33.7%, two-wheeler exports at 89,862 units were up 27.3%.

TVS Motors, the country's third largest two-wheeler manufacturer, posted healthy domestic sales volume at 173,771 two-wheelers in Oct'10, which represented a growth of 46.9%. The company's exports of two-wheelers numbering 18,051 too remained robust with a growth of 44.8% y-o-y.

Likewise, other two-wheeler makers, viz. Honda Motorcycle & Scooter India, Suzuki Motorcycle, India Yamaha and Mahindra & Mahindra Two-Wheelers merrily surged on, registering robust growth during the month.

Vehicle sales have been in top gear so far, exceeding all expectations and overshooting various forecasts. With economy performing reasonably well, auto market is headed for record, bumper sales during the current fiscal. CVs growth may see some moderation in the coming months, due to base effect, supply constraints, and the slowing of IIP growth.