India Market Sales Analysis – February 2011

Maruti Suzuki India sold a total of 111,645 vehicles in February 2011 (inclusive of 10,102 exports) making this the second consecutive month in which it has crossed the 100,000 milestone in sales. Last February, the company sold 96,650 vehicles.

Leading the sales numbers was the Alto, which racked up over 33,000 units followed by the WagonR which sold 14,131 units. The Dzire, the Maruti model that takes on the Toyota Etios, continued to be in the 8,000-9,000 unit range with sales of 9,490 units. Overall sales were up 19.4 percent in the A2 segment and 27 percent in the A3 segment. In the C segment, Maruti recorded a growth of 26.9 percent.

The carmaker launched its diesel SX4, which could well give the numbers sold here a boost given the increase in fuel prices. While two hikes were effected in petrol over the last three months, indications are that another may well be on the cards given the rising prices of crude as a result of the strife in the Middle East.

February also saw Maruti launch its luxury Kizashi saloon which is being brought in as a CBU. The Kizashi units despatched in February were display/test drive vehicles for dealers and deliveries to customers have begunthis month.

Tata Motors reported a total sale and distribution offtake of 33,751 units (comprising 31,909 Tata + 1,842 Fiat) in the domestic market in February 2011, higher by 15 percent compared to 29,238 units (26,985 Tata + 2,253 Fiat) in February last year.

Sales of Tata passenger vehicles were 31,909 units, 18 percent higher over February 2010. The company was able to cross the 30,000 unit mark again as a result of Nano sales which, at 8,262 units, were higher by 101 percent over February last year. Nano sales have surged after the company announced a four-year warranty to existing and new customers. Sales may well cross the 9,000 mark or more which would then be the highest ever recorded since July 2010.

The Indica range sales were 10,044 units, lower by 12.7 percent over February last year. The Indigo range recorded sales of 8,966 units, a dip over January 2011 sales but a growth of 22 percent over February last year. It is still early days as far as the Indigo ManzaElan, the new top-end version launched last month, but for Tata Motors this is indeed a strong showing and puts it within striking distance of Hyundai’s total. If one takes away the 126 units of the Santa Fe sold, then Hyundai is just 800-and-odd units ahead of Tata.

Meanwhile, Hyundai Motor India Ltd (HMIL) continued to grow at a steady pace with domestic sales growing at 5.3 percent in February 2011. Domestic sales accounted for 32,629 units as against 31,001 units in February 2010 while exports dipped by 17.9 percent from 23,609 units in February 2010 to 19,378 units in February 2011. Model-wise, the i10 surged ahead to 15,105 units; that’s more than Maruti’s Wagon R and, if its sales stay on course, it could make a Hyundai model the second-most popular car in the country.

Commenting on the company's February 2011 sales, ArvindSaxena, HMIL’s director - marketing and sales, said: “While the industry growth spurred by new products might be unusually high, Hyundai recorded positive growth supported by steady sales of its compact cars. We expect the average industry growth rate to stabilise in the future months.” HMIL sold a combined 4,685 units of the Accent and Verna while the Sonata Tranform sold 29 units.

Ford India sold 7,883 units of the Figo, another brisk-selling month for the car whose cumulative sales are now in the region of 70,000 units. More importantly, this strong showing means that the company is quite close to General Motors India’s total of 9,303 units.

General Motors India launched an LPG-powered Beat last month and it remains to be seen what impact this will have on sales of the car, which is one of the mainstays of the company. The Aveo and the Beat now have green versions to woo buyers who are keen to cut operating costs for their vehicles. Meanwhile, Honda Siel Cars India sold 3,668 units of the City and 500 units of the Civic in its total of close to 5,000 units in the month.

However, the company to watch is Volkswagen India which sold over 3,000 units apiece of the Polo and Vento. At a total of 7,000 units, it is pretty close to Ford but whether it can reach that figure remains to be seen. The strong showing of the Vento is noteworthy but with Maruti having launched a diesel-powered SX4, it looks like a battle of sorts between a long-time player and a new one whose ad blitz has been a watershed of sorts for the Indian market. ŠkodaAuto India announced a sales growth of 39.17 percent for February at a total of 2,512 units against 1,805 units in February 2010. The company said it has had a positive start to the year with an encouraging response for the newly launched Yeti and the New Fabia. Thomas Kuehl, Board Member, sales and marketing, ŠkodaAuto India, said: “Škoda is also poised to make critical changes in the brand philosophy this year which will further propel our growth plans.”

Meanwhile, Toyota Kirloskar Motor sold 2,786 units of the Etios in the month even as the Corolla and Fortuner continued to be the big sellers for the Japanese player. The company announced that it is taking active steps to bring down the waiting period for the Etios. This will be realised through various steps including starting of second shift production, changes to takt time (production time per vehicle), production enhancement and postponement of the launch of the EtiosLiva hatchback from April to June, all reflecting the increasing demand for the Etios.

In the luxury segment, Mercedes-Benz which has kicked off a second shift at its Chakan plant sold 662 cars including 362 units of the C-class and 230 of the E-class.

Hero Honda’s sales juggernaut rolls on

In the two-wheeler segment, Hero Honda Motors continues to be on a roll, recording its highest-ever February sales. The company sold 472,055 units in February 2011, representing a growth of more than 23 percent over February 2010 when it had sold 382,096 units. The company can be justifiably be proud that this is also the tenth consecutive month of 400,000-plus sales for the company. With cumulative sales of 48,86,592 units so far in this fiscal, Hero Honda looks positioned to cross the initial guidance of five million sales for the fiscal year 2010-11. The cumulative sales represents a rise of almost 17 percent over the cumulative sales for the corresponding period last year, when Hero Honda sold 41,85,492 units.

Anil Dua, senior vice-president (marketing & sales), Hero Honda Motors, said: “Our performance throughout this fiscal has been very consistent and the strong February numbers are a positive indication for the growth to continue. The Pleasure continues to do exceedingly well, now clocking 30,000 units per month regularly. We are also leveraging our association with the ongoing ICC Cricket World Cup in several ways. Through brandbuilding initiatives such as these, we continue to engage with our customers in new, exciting and relevant ways.”

Arch rival Bajaj Auto, which posted a 64 percent increase in net profits in the last quarter, recorded bikes sales of 286,657 units with the Pulsar and Discover comprising 67 percent of sales. The company will launch a new Discover model in April to add to its existing Discover range.

Honda Motorcycle &Scooter India recorded total sales of 145,819 units in the month, comprising 65,890 motorcycles and 79,929 scooters. While the overall growth was 19 percent over the year-earlier month sales, the growth for bikes was 28 percent and that of scooters 13 percent. Through the fiscal year so far, the company’s market share has fluctuated between 12 and 14 percent. Its bike and scooter sales have already crossed the last fiscal’s estimates and cumulative sales have crossed the 1.5 million mark, well above last fiscal’s 1.27 million units.

Meanwhile, riding on the success of its models in the premium segment, India Yamaha Motor posted a growth of 37 percent in its domestic sales in February 2011 as compared to the year-earlier month. The company registered sales of 23,384 units in February 2011 compared to 17,131 units in the same month last year in the domestic markets. “The company has displayed an upbeat spell in sales, on account of a strong product portfolio and high customer confidence. We attribute this growth to our accolade models such as the YZF-R15, FZ, SZ and the YBR series. We are also planning to implement our Best 3S (Sales, Service & Spares) set up in Tier 2 and Tier 3 cities and increase sub-dealers in the rural areas as well,” said Hiroyuki Suzuki, CEO and managing director, India Yamaha Motor. The company continues to leverage its relationship with customers with its focus on the ‘Yes! Yamaha’ campaign which aims to provide the Best 3S Experience. Meanwhile, the company is also conducting consumer-centric marketing initiatives like the Yamaha R15 One-Make Race, Yamaha Safe Riding Science for college students, among others.

Suzuki Motorcycle India registered an increase in its monthly sales figures at 28,738 units in February 2011 as compared to 23,016 units in February 2010, up by 25 percent. This increase in sales is attributed to the tremendous response to the recently launched Slingshot series. Atul Gupta, vice-president, sales and marketing, SMIPL, said: “We have received a very good response from the newly-launched Suzuki SlingShot series.”

BRIAN DE SOUZA

SIAM COMMENT: INDUSTRY’S MONTHLY GROWTH LOWER THAN 2010-11 CUMULATIVE GROWTH

The Society of Indian Automobile Manufacturers (SIAM) has said that the cumulative sales data for the April-February 2011 period shows domestic sales growth of 26.92 percent over the same period last year. In February 2011 as compared to February 2010, domestic sales grew at 21.32 percent. The passenger vehicle segment grew at 29.85 percent during April-February 2011 over the same period last year. Passenger cars grew by 30.34 percent, UVs by 19.69 percent and MPVs by 43.28 percent in this period. February 2011 figures for domestic sales of passenger cars show a growth of only 22.63 percent over the same month last year. However, in absolute numbers, this segment recorded the highest ever sales. Total passenger vehicle sales figures for February 2011 compared to February 2010 show that growth stands at 20.88 percent.

The overall CV segment registered growth of 28.65 percent during April-February 2011 as compared to the same period last year. While M&HCVs registered growth of 34.18 percent, LCVs grew at 24.08 percent. In contrast to the last February sales figures, February 2011 registered a growth of only 10 percent.

Three-wheeler sales recorded a growth rate of 19.96 percent in April-February 2011. While passenger carriers grew by 22.39 percent during April-February 2011, goods carriers notched growth of 10.31 percent.

Two-wheelers registered a growth of 26.55 percent during April-February 2011. Mopeds, motorcycles and scooters grew by 23.79 percent, 23.30 percent and 44.40 percent respectively. Comparing February 2011 to February 2010, the growth figures for three- and two-wheelers are at 24.03 percent and 22.04 percent respectively.

Exports

During April-February 2011, overall automobile exports registered a growth rate of 30.62 percent. Passenger vehicles registered a decline and the growth rate was (-) 0.86 percent in this period. The commercial vehicle, three-wheeler and two- wheeler segments recorded growth of 72.82 percent, 59.29 percent and 36.97 percent respectively during April-February 2011. In February 2011 compared to February 2010, overall automobile exports registered a growth of 27.57 percent.