Low festive season purchases dent car sales growth

The auto industry has had a mixed month. The build up to Dhanteras and Diwali was good but the demand tapered off subsequently.

Automobile makers, including Maruti Suzuki, Toyota, Mahindra and Tata Motors, reported single digit growth in domestic passenger vehicle sales in October with festive season purchases remaining largely muted.

Although the overall numbers were also impacted by high base effect of last year, Hyundai's domestic sales declined marginally, while Ford saw a 44 per cent dip as it prepared to launch an updated version of its best selling compact SUV, EcoSport.

The country's largest carmaker Maruti Suzuki India (MSI) said its domestic were at 136,000 units, up 9.9 per cent from 123,764 in October last year.

The sales were mainly driven by compact segment comprising Swift, Dzire and Baleno which jumped by 24.7 per cent to 62,480 units last month as against 50,116 units in the year-ago month.

Utility vehicle sales, including Gypsy, Grand Vitara, Ertiga, S-Cross and compact SUV Vitara Brezza increased by 29.8 per cent to 23,382 units in October, from 18,008 in the same month of 2016, MSI added.

However, mini segment cars, including Alto and WagonR, witnessed a 4.2 per cent decline to 32,490 units during the month under review, from 33,929 in October 2016, the automaker said.

Toyota Kirloskar Motor (TKM) on Wednesday reported a 6.45 per cent rise in domestic sales at 12,403 units in October.

The company had sold a total of 11,651 units in the same month last year, TKM said in a statement.

Homegrown auto major Mahindra & Mahindra reported a marginally growth in its domestic sales at 48,818 units last month compared to 48,729 in October 2016.

M&M president automotive sector Rajan Wadhera said: "The auto industry has had a mixed month. The build up to Dhanteras and Diwali was good but the demand tapered off subsequently."

Last year all festivals were in October and the industry volumes had a high base, he added.

Wadhera cautioned that going forward the auto industry would enter into a year-end period of lower sales.

Tata Motors said its passenger vehicles sales in the domestic market grew by 1 per cent year on year to 16,475 units last month.

"While we have grown, we could have done better had it not been for the long holiday season. We will maintain cautious optimism in the market and hope to see this momentum continue," Tata Motors president, passenger vehicles business, Unit Mayank Pareek said.

Ford India reported 43.82 per cent decline in domestic sales at 4,218 units last month as against 7,508 in October last year.

Explaining the sales decline, Ford India president and managing director Anurag Mehrotra said, "The ramp-up for new model introduction has impacted our wholesale for October."

Hyundai Motor India Ltd (HMIL) also reported a marginal decline in domestic sales at 49,588 units in October as against 50,017 units in the same month last year.

In two-wheeler segment, Chennai-based TVS Motor Co said its domestic sales declined to 270,372 units as against 272,229 units in the year-ago month.

Royal Enfield, the two-wheeler division of Eicher Motors, said its domestic sales were at 68,014 units in October as against 58,379 units in the year-ago month, up 16.5 per cent.

Suzuki Motorcycle India Pvt Ltd, also reported domestic sales at 46,020 units in October as against 36,493 units in the same month last year, a growth of 26.1 per cent.

Photograph: Babu/Reuters