Cheers Elude Auto Market

The slide of Indian auto market continues. The month of August 2008 followed the pattern of the previous month and the auto sales were not something to cheer about. Surprisingly, two-wheelers turned in a decent sales performance in the domestic market for the second month running thanks again to Hero Honda that continued to march on leaving its competitors far behind. Car market stayed in a slow lane, so did the CV and 3wheeler markets, all three segments recording negative growth. However, exports remained on growth trajectory, with Hyundai Motor India, Bajaj Auto and TVS Motor Company continuing to record robust export figures, and made the sales numbers look good somewhat.

Car market leader Maruti Suzuki India Limited was in the negative terrain, selling 59,908 vehicles (including exports) in August 2008 as against the sales figure of 65,968 vehicles in August 2007. While Maruti's domestic sales at 54,113 units were down by 10%, overall sales including exports slid 9.2% y-o-y during the month. MSIL's sales were propped by D'Zire that continues to sell in good numbers and helped the company's A3 segment grow by 12.2%.

Hyundai Motor India Ltd (HMIL), the country's second largest car manufacturer and the largest passenger car exporter, reported a cumulative sales growth of 57.5% during the month, riding on its healthy export and domestic sales numbers.

HMIL's total sales for the month of August 2008 stood at 44,710 units. While the domestic market accounted for 21,610 units, exports totaled 23,100 units in August 2008. As a result, the domestic sales grew by 33.9% and exports by 88.5% during the month.

Commenting on the sales, Arvind Saxena, Sr VP, Marketing & Sales, HMIL said, "Looking at the current market scenario, we are happy with Hyundai overall sales and this again reinforces our belief that if you have a strong product portfolio it will see you through even in tough times.

The Hyundai products starting right from the Santro and the i10 to the Accent have done exceedingly well and consumers have strong faith in these products both in India as well as overseas which reflects in the tremendous export growth. We hope that in the coming months the economic conditions will improve so the industry stabilises."

HMIL's segment-wise cumulative sales in the month of August, 2008 were as follows: A2 Segment (Santro, i10, Getz Prime) - 38,477 units; A3 Segment (Accent, Verna) - 6,193 units; A5 Segment (Sonata Embera) - 37 units; and SUV Segment (Tucson) - 3 units.

General Motors India managed to stay on positive growth track clocking a growth of 4.4% in sales in August 2008 y-o-y. The company sold 6074 units in August 2008 vis-à-vis 5817 units in August last year. The August 2008 sales comprised of 1514 units of Chevrolet Tavera, 913 units of Chevrolet Aveo, 410 units of Chevrolet Optra, 3020 units of Chevrolet Spark and 217 units of Chevrolet Captiva.

 
Ford India went downhill with a negative growth of 40% in its sales at 1,962 units during August 2008.

Bitten by the slowdown bug, Tata Motors witnessed a 3% fall in its total sale at 43,576 vehicles (including exports) during the month of August 2008 as compared to 45,132 vehicles sold in August last year. Cumulative sales of the company at 216,038 units during the five months of the current financial year have grown by 1 %, though.

Passenger vehicle sales of Tata Motors aggregated 15,573 units in the domestic market during August 2008, a decline of 6% from 16,620 vehicles sold in August 2007. The Indica sales at 7,756 units chipped off to the extent of 31.9% from the sales figure recorded a year ago in anticipation of the announcement of the next generation Indica Vista in the last week of August. The new generation Indica Vista, which went on showroom display in August, has received an extremely encouraging response from the market and the numbers of the Indica range should start looking up from September onwards as the retail activity commences in September. It is expected that demand of the Indica Vista will run ahead of availability in the next few months. The Indigo family recorded sales of 4,460 units, a 104% growth over August 2007. The Sumo and Safari accounted for sales of 3,357 units, rising by 11% y-o-y.

Tata Motors' cumulative sales of passenger vehicles in the domestic market for the fiscal in the first five months have totalled 81,319 units, representing a negative growth of 4.9% y-o-y. Cumulative sales of the Indica at 40,957 units have fallen by 28%, while Indigo family notching up the sales of 21,999 units, have grown by 84%.

The company's sales of commercial vehicles in August 2008 in the domestic market added up to 23,231 units, down 1 % compared to 23,419 vehicles sold in August last year. While LCV sales at 13,088 units grew by 11 %, over August 2007, M&HCV sales at 10,143 units, declined by 12.7%.

Tata Motors' Exports at 4,772 vehicles in August 2008 declined by 6% compared to export tally of 5,093 vehicles in August 2007.

Ashok Leyland too did not have much to boast of with its domestic sales at 4,225 units skidding by 20.4% from 5,512 units recorded a year ago. However, the company's exports aggregating 594 units posted a growth of 9.4%.

Mahindra & Mahindra managed to stay positive with a paltry growth of 1.7% in domestic sales of its utility vehicles at 7,695 units (7,563 units) in August 2008. The company's commercial vehicle and 3-wheeler sales in domestic market witnessed 1.7% and 50.9% growth, respectively.

In two-wheeler segment Hero Honda Motors Limited once again stole the thunder by logging domestic sales of 296,804 units (232,85,0 units), which translates into a healthy growth of 27.5%. The company's exports at 8,712 units rose by 8.6 % y-o-y during the month of August 2008.

Helped by robust exports at 58,647 units, Bajaj Auto Limited ended up with a positive growth of 3.8% in its two-wheeler sales. However, the company's domestic sales at 117,984 units (124,087 units) slid 5% in August 2008.

In keeping with its 125cc+ segment focus, Bajaj will commence production of the new Platina 125 DTS-Si Electric Start in September'08, targetting 10.000 units in the very first month.

This follows the successful launch of the new Discover 135 DTS-i in August 2008, of which 27,091 units were sold in its very first month.

By virtue of these introductions, Bajaj expects its domestic motorcycle sales to register double-digit growth in the second half of FY09.

Similarly, Bajaj's 3-wheeler sales are expected to grow in the second half of FY09 on the back of two new products, one each in the passenger and the goods segments.

TVS Motor Company posted 11% growth, registering total two wheeler sales d 114,321 units in August 2008 as against 102,734 units in the corresponding month of the previous year.

During the month, the company's motorcycle sales posted 13% growth notching up 52,304 units in comparison to 46,235 units recorded in August 2007. Sales witnessed a quantum increase with notable contributions across models including the fuel injected Apache RTR FI, which the company launched in the month of July 2008. Scooters posted 3% growth clocking 25,392 units as against 24,645 units in August 2007.

Two-wheeler exports of TVSM continued their upward growth trend, posting an increase of 51% at 18,083 units in August 2008, as against 12,006 units in August 2007.

Notwithstanding the unsteady first five months of the year, Auto market is pinning its hopes on the long festival season, new launches and the Sixth Pay Commission bonanza to the Government employees. Sales momentum should pick up in the half of the year.