India Market Sales Analysis – May 2011

A combination of rising bank interest rates and the steep Rs 5 per litre hike in petrol prices saw sales chug through May 2011. India’s largest carmaker, Maruti Suzuki sold 93,519 units, up 3.9 percent over May 2010’s sales of 90,041 units. The break-up of May 2011 sales comprises 61,048 units of the A2 segment comprising the Alto, WagonR, Swift, Ritz and A-star. Sales of the SX4 and Dzire rose 24 percent to 13,514 units as against 10,883 units in the year-earlier month. The company also sold 50 units of the premium Kizashi saloon in the month.

The company has been in the news for its plans to consider setting up a unit in Gujarat. While State government officials have reportedly confirmed that they met Maruti officials, it will be some time before a final announcement is made. Meanwhile, Hyundai Motor India recorded sales of 47,766 units in May as against 46,808 units in May 2010, up two percent. Domestic sales were 31,123 units as against 27,151 units in May 2010. According to sales and marketing director, ArvindSaxena, “The market has slowed down considerably after the Q1 because of increasing interest rates and rising fuel prices, among other factors.” He added that the company’s new Fluidic Verna has received over 12,000 bookings since its launch in mid-May. Segment-wise, HMIL’s May 2011 sales were as follows: A2 segment (Santro, i10, i20) 40,520 units; A3 segment (Accent and Verna) 7,110 units; A5 segment (Sonata Transform) 14 units; and Santa Fe: 122 units.

Tata Motors’ passenger vehicles business recorded sales of 21,549 units (19,401 Tata and 2,148 Fiat) in the domestic market in May 2011 as compared to 23,487 units (21,324 Tata and 2,163 Fiat) in May 2010.

Sales of Tata passenger vehicles for May alone at 19,401 units were lower by nine percent over May last year. Nano sales dropped to 6,515 units as against 10,000 units in April 2011. Sales of the Indica range were 5,497 units, lower by 35 percent over May last year. The Indigo range recorded sales of 4268 units, lower by 35 percent over May last year. The Sumo/ Safari/ Aria/ Venture range accounted for sales of 3,121 units, higher by 15 percent over May last year. Cumulative sales of the Nano were 16,527 units in April-May, a 134 percent increase compared to 7,075 units in the year-earlier period. Cumulative sales of the Indica range were 9,747 units, down 44 percent while cumulative sales of the Indigo family were 9,550 units, lower by 31 percent.

Mahindra & Mahindra said its sales numbers rose 20 percent to 34,323 units during May 2011 as against 28,488 units during May 2010. The company’s domestic sales stood at 32,159 units in May 2011, as against 27,038 units during May 2010, up 19 percent. The Verito sold 1,291 units in May 2011, as against 450 units in May 2010, its highest since September 2009. The passenger vehicles segment (which includes UVs as well as the Verito) registered a growth of 20 percent, having sold 16,702 units in May 2011, as against 13,939 units during May 2010.

Meanwhile, Volkswagen India sold 6,185 vehicles in May 2011, a growth of 244 percent over the 1,796 units sold in May 2010. The Polo and the Vento continue to be the backbone for the brand with a total of 5,889 units sold in May 2011. The recently-launched new Passat clocked sales of 184 units.

Neeraj Garg, board member Volkswagen Passenger Cars, sounded a hint of caution when he said that while the company was pleased with the overall performance and acceptability of its products, but hoped to continue this “performance in the coming months despite the current market scenario”. Škoda Auto India’s sales stood at 2,761 units in May against 1,381 units for May 2010. The company recently inaugurated its 3s facility dealership in Delhi and has plans to inaugurate similar such 3s facility dealerships across India. The Czech auto major aims to double its sales globally by 2018 to at least 1.5 million units. Škoda is looking towards the Indian market to contribute a considerable share percentage to its global sales figures. The company plans to launch a saloon in the midsize segment to take on the Vento which has made a mark for itself in the segment by overtaking the Honda City.

Nissan Motor India said it recorded sales of 1,588 units in May 2011 compared to 56 units of completely-built-up units in May 2010. Sales of the Micra accounted for an overwhelming 1,566 units in the month. The X-Trail, Teana and the 370Z comprised the remainder of 22 units.

In the luxury segment, Audi sold 408 units while Mercedes-Benz sold 314 units of the C-class and 130 units of the E-class.

Hero Honda keeps up the momentum

Hero Honda Motors continued its strong growth momentum in the new financial year with yet another month of over 500,000 sales. The two-wheeler manufacturer reported sales of 5,00,234 units for May 2011 – its third consecutive month of over 500,000 unit sales in a month. The sales figures are a healthy 14.7 percent growth over the corresponding month in 2010, when the company sold 4,35,933 units.

Anil Dua, senior VP (marketing, sales & customer care), said: “We have crossed the one million sales mark in the very first two months of this fiscal. On other fronts, we have now scaled up capacity at our existing three plants to 6.15 million units. And now with the forecast of a good monsoon, we expect the market demand also to sustain itself.” Hero Honda is currently in the process of building a new brand identity and developing new brand communication. The company is also focused on enhancing its own R&D capability and exploring overseas markets for exports.

Meanwhile, Bajaj Auto sold 317, 989 units in May, 18 percent over May 2010 sales of 269,488 units. The Discover brand sold 1,39,000 units.

TVS Motor Company increased its total two-wheeler sales by 18 percent with 181,891 units sold in May 2011 in comparison to 154,667 units in May 2010. Scooter sales increased by 20 percent with 38,168 units sold, compared to 31,884 units recorded in May 2010. Motorcycle sales were up by 11 percent totaling 75,619 units in May 2011 as against 67,906 units in May 2010. TVS’ domestic two-wheeler sales reported a growth of 16 percent with sales of 158,829 units in May 2011 against 136,621 units in May 2010.

Honda Motorcycle & Scooter India recorded a six percent increase in sales in May 2011 over May 2010. It sold 145,729 units comprising 69,488 units and 76,214 units. With the company’s first factory running at full capacity, it is now banking on the second unit at Tapukara. HMSI has launched the CB Twister in two new colours: Heavy Grey metallic and Pearl Sunbeam White.

India Yamaha Motor has registered a sales growth of 58.7 percent in its domestic market in May 2011 with a sale of 27,959 units as against 17,614 units sold last year. The company’s export figures stood at 10,853 units in May 2011 while 7,419 motorcycles were exported in May 2010. Overall sales stood at 38,812 units in May, 2011 as against 25,033 units in May 2010, up 55 percent.

Hiroyuki Suzuki, CEO & MD, India Yamaha Motor, said: “We are seeing good sales growth this year and expect the momentum to continue for the rest of the year. Our recently launched refreshing FZ series has got a great response and our SZ series is helping us equally in boosting sales. This is the direct result of efforts we have been making to connect with our target customers through various marketing initiatives like the Sales and Service camps, Yamaha Fiesta, R15 One Make Race Championships and other youth-centric sports events.” Yamaha has also begun eyeing football to promote its products and conducted the Yamaha ASEAN CUP U-13 Football 2011 for the first time in India last month. The tournament winner — Team Kolkata — will represent India at the third Yamaha ASEAN Cup U-13 finals in July.

Meanwhile, Mahindra 2 Wheelers said its sales for May 2011 stood at 10,970 units, an increase of 36 percent over the last year. Total cumulative sales from April to May 2011 stood at 20,525 units, up 20 percent over the same period last year when sales totalled 17,055 units. Cumulative sales have crossed a landmark figure of 250,000 units, while the Rodeo has crossed 100,000 units. The company which launched its first motorcycle offering last year and then withdrew it due to a host of technical problems is looking to “recalibrate” the offering, said officials at the press meeting called last month to announce the fourth-quarter results.

BRIAN DE SOUZA