Auto Market Remains Subdued in August 2018

Auto Sales in the month of August 2018 was slow. Passenger vehicles sale during the month was in negative trajectory. However, Commercial Vehicle, Three-Wheeler and Two-Wheeler sale kept up the momentum recording positive growth. Total industry sales during the month stood at 2,793,288 units against 2,635,447 units during the same month last year, registering growth of 5.99 per cent.

Passenger vehicles sale were down for the second consecutive month during the year due to severe floods in Kerala and high base in the previous year. Sales were down by 2.46 per cent at 287,186 units in the domestic market against 294,416 units sold in August 2017. In the international market, the segment sold 60,811 units registering growth of 7.13 per cent. The total passenger vehicle sales during the month stood at 347,997 units against 351,182 units, decrease by 0.91 per cent.

Two-Wheeler sales remained muted during the month due to high base effect, weak demand and adverse policy issues in West Bengal. In the domestic market, scooter sales were down by 0.6% at 669,416 units and mopeds were down by 13.47 per cent at 70,883 units. However, motorcycles showed a decent growth of 6.18 per cent at 1,206,512 units. In the international market 288,880 units of 2-W were sold recording a growth of 22.15%. 

Commercial Vehicle sales accrued double digit growth at 29.56 per cent selling 84,668 units in the domestic market and by 27.18 per cent Y-o-Y in the international market  selling 9,274 units. Infrastructure development and improved economic activity provided the thrust to medium and heavy vehicles in the domestic market which grew by 28.54 per cent to 34,072 units and light commercial vehicle sales increased 30.25 per cent y-o-y to 50,596 units during the month.

Three-Wheeler sales continued in positive terrain mainly due to permits released in Maharashtra, Karnataka, Andhra Pradesh and Delhi. In the domestic market, sales vroomed to 22.83 per cent selling 63, 199 units during the month and exporting 51,510 units, increase of 61.82 per cent y-o-y.

Car market leader Maruti Suzuki India Ltd (MSIL) sold a total of 156,336 units in August 2018. This includes 145,895 units in domestic market and 10,441 units of exports. The Company had sold a total of 162,846 units in August 2017. The company recorded a 3.6 per cent decline in its domestic sales volume that stood at 145,895 units in August 2018. 

Other than the entry-level segment of the Alto and Wagon R and the new Ciaz, sales were down in all its other segments, particularly UVs whose sale was down by 16.2 per cent

In the Mini segment, the Alto and Wagon R together notched 35,895 units, up 1.3 per cent over year-ago sales of 35,428 units; in the Compact segment -  Swift, Dzire, Ignis, Celerio and Baleno, the collective sale of these five models stood at 71,364 units against 74, 012 units sold in Aug’17 was down by 3.6 per cent. In the Mid-Size segments Ciaz sold 7,002 units in the domestic market gaining by 8.4 per cent y-o-y.

Hyundai Motor India Ltd (HMIL), the country’s second largest carmaker reported 2.8 per cent slide in its domestic sales at 45,801 units and 25.8 per cent y-o-y growth in exports at 16,111 units during August 2018. 

Commenting on the August sales, Vikas Jain, National Sales Head, HMIL, said, “Hyundai continues to register strong growth in export markets with 25.8% and a total volume of 61,912 units and overall 3.4% on the strong performance of GRAND i10, new ELITE i20 and New 2018 CRETA - Each continuing to cross over 10,000 sales mark consistently.”

UV major, Mahindra & Mahindra registered a growth of 2.1 per cent in domestic sales of its Cars, UVs and Vans, selling 19,737 units in August 2018 as against 19,325 units a year earlier. The company’s total sales during the month stood at 20, 544 units climbing up by 3.5 per cent  from 19,858 units in August 2017. Export by M&M was on high growth trajectory shooting up by 51.4 per cent y-o-y to 807 units during the month.

Commenting on the monthly performance, Rajan Wadhera, President, Automotive Sector, M&M, said, “Our CV portfolio including Trucks and Buses continue to post robust growth. With the launch of the Marazzo scheduled next week, we hope to see buoyancy in our passenger vehicle numbers. With the upcoming festive season, we do expect a much improved traction for passenger and commercial vehicles alike”.

Tata Motors’ Passenger Vehicles domestic sales in August 2018 continued its growth trend at 20,323 units compared to 16,261 units, higher by 25% over last year. The Passenger Car segment registered a growth of 4.9 per cent, while the UV segment grew by 122.2 per cent but Vans de-grew by 0.9 per cent y-o-y. Cumulative sales of PV in the domestic market for the fiscal (Apr-Aug’18) grew by 38 per cent, at 88,436 units compared to 64,131 units for the same period, last fiscal.

The company’s sale from export of PVs in August 2018 were at an impressive 290 units compared to 98 units last year, a growth of whopping 195.9 per cent.

Honda Cars India Ltd (HSCI) reflected the subdued consumer sentiment with sales declining by 2 per cent to 17,020 units during the month of August 2018 from 17, 365 units in August 2017.  HCIL also exported a total of 597 units in August 2018.

The company has been maintaining strong sales momentum in the current fiscal year and had sold 79,599 units during April – Aug 2018 with a cumulative growth of over 9% as against 73,012 units in the corresponding period April – August 2017.

Rajesh Goel, SVP and Director, Mktg & Sales, HCIL, said, “There was an impact of Kerala floods and heavy rains in many parts of the country combined with GST related high base effect of August 2017. We hope to recover quickly and keep growing strongly with rollout of attractive offers.”

Toyota Kirloskar Motor (TKM) continued to grow, thanks to the hefty contribution of Innova Crysta and Fortuner, clocking a growth of 17.6 per cent in its domestic sales during the month of August 2018. The company sold a total of 14,638 units during August 2018 as compared to 13,052 units in the corresponding month last year.

“We have registered strong demand with cumulative sales of over 52,000 units from January to August 18 period with a growth of 13% as compared to same period previous year. We thank our customer for their strong support and trust in the Innova brand.” said N. Raja, Deputy MD, TKM.

Ford India’s domestic wholesales in August rose 3.4 per cent to 8,042 vehicles as against 7,777 units in the same month last year. Exports grew to 12,606 vehicles compared to 7,963 units in August 2017.

Renault India and Nissan India the other players in this segment, registered a negative growth rate of 31.6 per cent at 6,557 units against 9,585 units sold in August 2017 and 41.3 per cent at 485 units against 826 units sold in the corresponding month last year  respectively in the domestic market.

Keeping up the momentum of strong performance, Hero MotoCorp, the world’s largest selling two-wheeler manufacturer, reported yet another month of strong sales.

Riding on sustained demand for its range of motorcycles and scooters, Hero MotoCorp sold 685,047 units in August 2018. The Company had sold 678,797 units of two-wheelers in the corresponding month of the previous fiscal.

Hero MotoCorp sold a record 3,469,661 units of two-wheelers in the first five months (Apr-Aug’18) of FY’19, thereby clocking a growth of 10% over the corresponding period of the previous fiscal, when the Company had sold 3,141,551 units.

In the domestic market, Hero MotoCorp sold 663,040 units in August 2018 against 661,490 units sold in August 2017 gaining marginally by 0.2 per cent. Company however, gained a decent 27.2 per cent growth in exports, selling 22,007 units during the month.

Bajaj Auto sold 218,437 two-wheelers in Indian market in August 2018, which was a gain of 27.2 per cent than the corresponding sales figure of 171,664 units for August 2017. Bajaj Auto’s exports also saw a 28.8 per cent positive traction at 144,486 units during the month.

TVS Motor also recorded marginal growth with its domestic sale of two wheelers growing y-o-y by 1.7 per cent selling 275,195 units in August 2018.

Honda Motorcycles and Scooters India (HMSI) posting a contraction of 1.5 per cent in its domestic sales at 577,249 units in August 2018 against 586,237 units sold in the same month a year ago. Exports at 37,227 units were up by 3.4 per cent during the month.

Suzuki Motorcycle India was the other two-wheeler player to have bucked the trend with a healthy growth of 30.8 per cent in domestic sales at 62,446 units. However the company’s export fell by 20.7 per cent at 7,621 units.

Royal Enfield also headed north, by selling 68,014 units and gaining marginally by 1.7 per cent y-o-y.

Mahindra & Mahindra in the commercial vehicles segment sold 20,326 vehicles in August 2018, registering a 24.7 per cent growth. In the Medium and Heavy Commercial Vehicles segment, M&M sold 1,206 vehicles for the month, a significant growth of 113.1 per cent and 19,120 LCVs during the month, gaining by 21.5 per cent. M&M exported a total of 2,951 vehicles in August 2018, a growth of 14.3 per cent YoY.

Domestic sales of Tata Commercial vehicles in August 2018 were 37,956 units, up 28 per cent over 29,645 units in August 2017. While the company’s LCV sales numbering 21,442 units grew by 35.5 per cent, M&HCV sales of 16,514 units saw a growth of 19.5 per cent y-o-y during the month.

Ashok Leyland sales tally ensured a decent 39.3 per cent growth in domestic sales, which stood at 16,628 units in August 2018.  But the company’s exports were in negative territory, plummeting by 54.8 per cent to 758 units during the month.

VECV Eicher sales, both in domestic & international markets, were positive. In the domestic market, the sales were up by 26.8 per cent at 4,843 units against 3,818 units sold in August 2017; and on export front, the company sold 1,105 units which was a gain of 57.2 per cent y-o-y.

India’s Industrial Production rose by 6.6 per cent from a year earlier in July 2018 exceeding the market expectations. With good monsoon, strong underlying demand drivers, new launches and upcoming festive season, good traction is expected in auto market.

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