Automobile Sector On A Bumpy Road


After the previous month’s brief revival in sales its back to a bumpy ride for automobile makers in India.

Almost, all carmakers have witnessed a drop in their sales, led by Tata Motors.

Others, namely Mahindra & Mahindra, Maruti Suzuki, Nissan, Honda, Hyundai, etc. Struggled to either attract buyers.

The overall passenger vehicle sales edged down in the month of November 2019, down 0.20% at 2,62,892 units when compared to 2,63,455 units a year ago.

Maruti Suzuki that accounts for 50% of India’s PV segment, has managed to buck the steep decline trend in domestic sales while Mahindra & Mahindra, Tata Motors, Toyota Kirloskar were hit by poor demand.

Interestingly, new entrants Kia Motors and MG Motors continued to post aggressive sales.

Maruti Suzuki, which had posted a 2.3% increase in sales in October breaking a series of seven straight months of decline, fell again in November posting a 3.3% drop in its passenger vehicle sales over the last year.

The company dispatched 139,133 units to its dealerships across the country last month against 143,890 units in October last year.

In absolute terms, this was Maruti’s highest sales in any month this fiscal.

Apart from new launches like S-Presso and XL6, the other reason behind the marginal decline of Maruti Suzuki is that it has already started dispatching BS-VI models.

The company has converted 80% of its product portfolio meeting the standards of new emission norms.

At the start of the new year, November and December months were expected to post good numbers because of strong pre-buying in the market.

Tata Motors reported a drop of 25% in domestic sales at 38,057 units in November 2019. It saw a sharp decline in volumes for passenger and commercial vehicles when compared to the 50,470 units sold during the same month last year.

Mahindra and Mahindra reported a 9% fall in its total sales in November, on a year-on-year basis.

It sold 41,235 units, including exports, last month, compared to 45,101 vehicles sold during the same period last year.

In the passenger vehicles segment which includes utility vehicles, cars, and vans, M&M sold 14,637 vehicles in November 2019, 10% lower than 16,188 vehicles recorded in November 2018.

The sale of its commercial vehicles fell 12% to 17,384 units.

M&M sold over 10 utility vehicles like Bolero, Thar XUV300, TUV300, Scorpio, XUV500, Marazzo, and Alturas.

People tracking the industry are of the view that new product launches have been able to arrest the steep double-digit decline recorded before the festive season.

India’s automobile industry is bracing itself for a unique challenge in the first quarter of 2020 when the transition of BS-IV to BS-VI emission norms has to be made at the stroke of midnight on March 31, 2020. No BS-IV vehicle could be sold from April 1, 2020, which means automakers would have to reduce their inventory on BS-IV models to zero by then.

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