Two-Wheeler Sales Encounter a Speed-braker

Long run of high-speed Two-wheeler sales hit a bump in August with the segment witnessing a paltry growth of 3.52%. However, all the other segments continued to post the double-digit growth. Overall, the industry grew by 6.51 % in August 2006 y-o-y.

Car market leader Maruti Udyog Limited sold 48,259 vehicles in the domestic market in August 2006, which is 15.5% more than the domestic sales of 41,717 vehicles in August 2005. In all, Maruti Udyog Limited sold 51,855 vehicles in August 2006. The company's exports at 3,596 units dropped by 25%.

Maruti's sales volume in the domestic market grew by 22.2 per cent in A2 segment, 14.6 per cent in the A3 segment and 17.3 per cent in C segment during the month compared to sales in August 2005. Sales of Maruti 800 slid 9.3% to 6,425 units from 7,084 in August 2005.

The second largest player in Indian car market, Hyundai Motor India recorded a combined sale of 26,374 units in August 2006 achieving a growth of 8.5% over the same month in CY2005. The number of vehicles sold in the domestic market during the month was 16,101, up 8% over August'05. The exports at 10,273 units grew by 9.2%. HMIL sold 23,059 units in A2 segment, 3,105 units in A3 segment, 157 units in A4 segment, 19 units in A5 segment and 34 SUVs.

General Motors India's sales growth was, however negative and declined by 14%, with a tally of 2,720 units in August 2006 as against 3,159 units in August 2005. The August 2006 sales comprise 1,706 units of Chevrolet Tavera, 312 units of Chevrolet Optra and 702 units of Chevrolet Aveo.

GM India has recently launched the CNG version of its premium sedan - Chevrolet Optra priced at Rs. 8.10 lakhs (Ex-showroom, Delhi). It has also announced a scheme entitled "Total Peace of Mind and Protection Offer" for the Chevrolet Optra, which offers customers a special price of Rs. 7.24 lacs (Ex showroom, Delhi) for Optra as against a normal price of Rs. 7.81 lacs and a 3-year/60000kms warranty coverage plus free service/maintenance plan for 3-year/45000kms and lastly, a minimum assured resale price on the vehicle.

 
Honda Siel Cars India registered a remarkable growth in sales for the month of August 2006 registering an increase of 43.3% over last year. The company sold 5,247 units in August 2006 as against 3,661 units sold in the corresponding month last year. The company's recently launched model, Honda Civic, continued its successful run and sold 1,845 units during the month. The company's modelwise sales for August 2006 were: City - 3,039 units; Civic - 1,845 units; Accord - 242 units; and CRV - 121 units.

Mahindra & Mahindra's shored its leadership position with sales of 14,032 vehicles, including exports, in August registering a healthy growth of 14.2%. Domestic vehicle sales for the month of August were up 11.7%.

The all new Scorpio performed particularly well by attracting an ever-growing number of car lovers. The Scorpio clocked sales volumes of 3,794 units growing 20% over the corresponding month last fiscal.

Tata Motors witnessing an upswing of 26.2% in its total sales, clocked a sales figure of 45,681 units (including exports) in August 2006 as against the total of 36,205 vehicles sold in August last year.

The company's passenger vehicle sales in domestic market at 17,541 units in August 2006 surged by 26.4% over August 2005. The Indica sales at 11,920 units, moved up by 48% y-o-y. The Indigo family sales at 2,170 units, witnessed a decline of 31.5% vis-à-vis August 2005. The Sumo and Safari garnered sales of 3,451 units, growing 29.7% over August 2005. Safari recorded its highest ever sales of 1,305 units, in any month, in August.

The company's sales of commercial vehicles in August 2006 in the domestic market aggregated 23,069 units, an increase of 35% over 17,071 vehicles sold a year earlier. M&HCV sales stood at 13,455 units registering a growth of 38.6%, while LCV sales numbering 9,614 units, grew by 30.6% over August 2005.

The company's exports at 4,761 units in August 2006, however, declined by 9.4% as compared to 5,256 vehicles exported in August 2005.

Ashok Leyland sold 6,483 commercial vehicles in the month of August 2006, compared with 4,737 vehicles in August 2005, registering a rise of 37%. The company exported 786 vehicles as against 331 units in the same month previous year.

Commercial vehicle manufacturer Eicher Motors' vehicle sales leapfrogged by 44%, clocking 2,045 units in August 2006 vis-à-vis 1 ,415 units a year ago.

The company's newly launched tipper Terra 16 in select markets has been received well. Eicher sold 1,667 units of LCVs and 293 units of its HCVs during August 2006.

The vice like grip of Hero Honda on the Indian two-wheeler market indicated a sign of loosening. Hero Honda's combined bike and scooter sales growth was down by nearly 13% during the month of August 2006 with a total sale of 2, 15,076 two-wheelers vis-à-vis the sales of 2,46,304 units recorded in August 2005. The company attributed the dip to floods as well as closing down of its plant for a week for maintenance.

The company has crossed the two million sales mark in January-August 2006. This growth is significant considering the already huge base, which Hero Honda has built up as the market leader over the years.

Meanwhile, Hero Honda announced its new plant to be set up in the Integrated Industrial Estate in Haridwar, developed by SIDCUL (State Industrial Development Corporation of Uttaranchal Ltd). The Hero Honda plant and its main ancillaries will be located on a 275 acre plot in the prime area of the industrial estate. The plant will start operations with an initial production capacity of 5,00,000 units, at an investment of approximately Rs. 300 crores. By 2010, Hero Honda and its ancillaries will invest Rs. 1,900 crore in the new plant, achieving a capacity expansion to 1.5 million units, thereby enabling the company to cater to future market demand and consolidate its market leadership.

Bajaj Auto saw its motorcycle sales at 1,80,570 units in August 2006 zooming by 21 per cent over 1,49,415 units in the same month last year. Total two-wheeler sales at 1,82,013 units (1,64,020 units), clocked a growth of 11% over August 2005. The sale of three-wheelers in August 2006 stood at 26,150 units compared to 22,782 units sold in August last year, recording an increase of 15%. The total two and three-wheelers sales at 2,08,163 units were up 11%. Exports rose from 23,752 units in August 2005 to 32,283 units in August 2006, reflecting an increase of 36%.

TVS Motor Company's total two wheeler sales in August 2006 vroomed to 135,533 units witnessing a robust growth of 32% over 103,063 units in August 2005. The total motorcycle sales in August 2006 stood at 83,014 units and rose 39% over 69,675 units in August 2005.

TVS StaR and Apache continue to be the drivers of motorcycle sales and the company is enhancing its production to meet the demand especially with the festival period on the anvil. Apache continued to be the number two brand in the premium segment.

TVS Scooty sales totalled 23,118 units in August 2006 compared to 21,873 units a year earlier. The recent launch of Pink colour Scooty Pep+, part of the fashion series, has attracted a great deal of interest among young girls. Apart from several ongoing initiatives, the company will soon bring out unique options to the customers where they could choose their own colour. To begin with, this project will be launched in Bangalore.

On the export front, TVS Motor Company recorded its highest ever exports of 11,008 units in August 2006, clocking a spectacular growth of 71 % y-o-y.

The auto industry stays on course, although the August figures do not measure upto expectations. The automobile market is going to see a lot of action and excitement as the festival season draws near. As the economy is doing very well, there is no reason why the current financial should not end on a high note.