March Sales Renew Hopes

The patchy 2015-16 ended on an optimistic note for auto market with all segments posting positive growth in March 2016 and, thereby, rekindling hopes of firm recovery. Total domestic sales across various vehicle categories grew by 10.8% y-o-y to 1,855,663 units in March.

Passenger vehicle sales steady in March 2016

Passenger vehicle sales in the Indian market at 256,942 units stayed on course, albeit growing at lower pace of 5.1%. As has been the pattern in the last few months, the growth was propelled by the new models launched recently. 

Maruti Suzuki India (MSI), leader in the Indian passenger vehicle market, sold 118,895 units in the domestic market during March 2016, clocking a growth of 14.6% over domestic sales volume of 103,719 units in March 2015. The company’s exports stood at 10,450 units, up 33.4% y-o-y.  

MSI ended 2015-16 with its highest ever annual sales of 1,429,201 units (including domestic sales & exports), which represents a growth of 10.6% y-o-y. This tally comprises highest ever domestic sales of 1,305,351 units and 123,850 units of exports. For the fourth year in a row, the top four best-selling models in India are from Maruti Suzuki: Alto, Dzire, Swift and WagonR. 

According to the company, new models including S-Cross, Baleno and Vitara Brezza, as also the expansion of existing network and introduction of NEXA (company’s premium retail channel) brought incremental numbers.

Hyundai Motor India Ltd (HMIL), the second largest passenger vehicle player, witnessed a 4.2% uptick in domestic sales that stood at 41,201 units in March 2016, vis-a-vis 39,525 units in March 2015. HMIL’s exports crawled up by 0.4% y-o-y to 10,251 units during the month.

Rakesh Srivastava, Sr VP - Sales and Marketing, HMIL said, "Hyundai for FY’15-16 achieved an all-time highest volume of 484,324 units with 15.1% yearly growth and highest-ever market share of 17% plus on the strong performance of models like Creta, Elite i20 and Grand i10."

Mahindra & Mahindra (M&M) that had gone off-track for a while has bounced back with a bang with the launch of new models. The company reported a 21.2% rise in its domestic passenger vehicle (PV) sales at 26,885 units in March 2016, as against 22,183 units during March 2015.

The domestic passenger vehicle sales volume of M&M for 2015-16 totalled 236,307 units, translating into a 5.5% y-o-y growth. A strong market response to new products like TUV300 and KUV100 helped M&M post positive numbers for the year. This growth comes after two consecutive years of double-digit decline for the automaker. In 2014-15, the company had sold 223,968 units in the domestic PV market with a dip of 11.9%, which was preceded by a decline of 18.1% in 2013-14, with sales tally of 254,344 units. M&M had reported its best ever domestic PV sales in 2012-13, when the company sold 310,707 units with a growth of 26.4%. 

On the other hand, another home grown auto major, viz. Tata Motors continued to slip in passenger vehicle sales. The company sold 11,268 passenger vehicles (including cars, utility vehicles & vans) in domestic market during March 2016, down 34.5% from 17,211 units in March 2015.

Honda Cars India Ltd (HCIL), having started the year on a high note is losing steam. The Japanese carmaker sold 17,430 units in March 2016, down 23.2% (March 2015: 22,696 units). The City sedan was the best-seller for the company with 5,662 units, followed by Amaze (5,223 units), Jazz (3,683 units), Brio (2,158 units), and Mobilio (610 units). HCIL finished with annual domestic sales of 192,059 units in 2015-16, a modest 1.6% increase over 189,062 units in 2014-15. 

Toyota Kirloskar Motor (TKM) sold  7,637 units in the domestic market in March 2016, which reflected a sharp 42.7% fall vis-a-vis the domestic sales figure of 13,333 units a year ago.

N Raja, Director & Sr VP - Sales & Mktg, TKM, said: “The ban on registration of diesel vehicles in Delhi & NCR area has affected our sales. We are hopeful that the matter will be concluded favourably during next hearing.”

Renault India registered a whopping 159.8% growth in its domestic sales at 12,424 units in March 2016 (March 2015: 4,782 units), driven by strong sales momentum of its new offering, Kwid.

Bucking rural slowdown, two-wheeler sales remain buoyant

The challenging rural economic environment notwithstanding, the two-wheeler sales in domestic market at 1,467,714 units remained in positive territory, clocking a decent growth of 10.9% y-o-y. Importantly, sales of motorcycles , which had been witnessing a slowdown for some time, are revving up once again. 

Hero MotoCorp Ltd (HMCL), the world’s largest two-wheeler manufacturer, capped-off yet another year as the dominant market player in the country with a strong sales performance in March 2016 that saw the company clock a healthy 12.1% increase year-on-year with domestic sales tally of 583,193 units. Hero MotoCorp set yet another benchmark by exceeding the landmark of 6-lakh plus monthly sales thrice in a single financial year – March 2016 (606,542 units), October 2015 (639,802 units) and September 2015 (606,744 units). 

The company ended up selling 6,632,152 units of two-wheelers (including domestic sales & exports) during FY15-16, as against 6,631,703 units in the previous fiscal.  

Commenting on the company’s performance since it set out on a solo journey after parting ways with Honda, Pawan Munjal, CMD and CEO, HMCL said, “In the past five years, we have consolidated our leadership in the face of a volatile market and intense competitive environment, even as Brand Hero has become globally known with a presence in about 30 countries across Asia, Africa and Central & South America.”

Honda Motorcycle & Scooter India (HMSI) reported a decline in its domestic sales for March 2016, selling 365,729 units in the local market, down 4.9% (March 2015: 384,452 units).

While HMSI maintains its leadership in the scooter market, its motorcycle sales have failed to gain traction. During FY15-16, HMSI’s total sales aggregated 4,483,835 units, while domestic sales closed at 4,283,690 units. Creating a new high, Honda’s 2-wheeler exports crossed the 2-lakh-unit mark (200,145 units) for the first time ever in FY15-16.

Honda added approximately 2 new touch-points every day. HMSI expanded its network to 4,500+ and added 850 new touch-points in FY’16. 

Elaborating on the strategy for FY16-17, Keita Muramatsu, President & CEO, HMSI said, “2016-17 is going to be Honda’s most definitive year in India. I am excited that with the new 4th plant, we will be able to delight more than 5 million new customers in one year for the first time in Indian operations.”

Bajaj Auto clocked total sales of 264,249 two-wheelers in March 2016, thereby posting healthy growth of 25.9% y-o-y. Domestic two-wheeler sales of Bajaj Auto during the month added up to 176,788 units - a robust 31.3% increase over 134,660 units a year ago. The company’s two-wheeler exports were also in top gear, surging by 16.2% y-o-y to 87,461 units. 

TVS Motor Company recorded a healthy 19.6% rise in its domestic two-wheeler sales that stood at 200,200 units in March 2016 vis-à-vis 167,428 units in March 2015. The two-wheeler exports of the company at 26,453 units were, however, down 19.4% y-o-y.

Clocking an impressive growth of 44.2%, India Yamaha Motor sold 60,032 two-wheelers in the domestic market during March 2016, as against domestic sales volume of 41,640 units in March last year. 

Maintaining  high double-digit growth momentum month after month, Royal Enfield reported an impressive 52.4% surge in its domestic sales at 50,059 units during March 2016 as against the corresponding sales figure of 32,854 units in March 2015. The company’s exports were also on fast track, soaring by 52.8% y-o-y to 1,261 units during the month.

Commercial Vehicles stay on growth trajectory

Benign fuel prices, continuing renewal of aging fleet by the transport operators and increased pace of infrastructure building helped commercial vehicles stay in fast lane. Importantly, after struggling for more than two years, the LCVs are exhibiting firm recovery.  

Tata Motors sold 35,433 CVs in the Indian market during March 2016, higher by 18.8% compared to the  sales figure of 29,833 units in March 2015. Domestic sales of M&HCVs grew 24.6% y-o-y to 18,538 units, while that of Tata LCVs notched up a decent 13.0% y-o-y uptick at 16,895 units in March.

Ashok Leyland continued in overdrive. The company’s domestic sales at 15,445 units in March 2016 witnessed a handsome 31.3% upswing, as against 11,762 units in March 2015. The exports were also on high-growth curve, rising by 28.0% y-o-y to 1,257 units during the month.

Mahindra & Mahindra’s M&HCV sales numbers in domestic market at 1,106 units were up 76.7% in March 2016, compared with 626 units a year ago.  Domestic sales of Mahindra LCVs added up to 16,332 units in March 2016, marking a 20.3% increase over 13,573 units a year back.

VE Commercial Vehicles recorded strong 45.5% growth selling 5,944 units in domestic market (March 2015: 4,084 units).

The March sales performance portends well for the auto market. With the Met department predicting a normal monsoon this year, expect the fortunes of rural India to improve, which will have domino effect on economy and automotive market.




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