April car sales weighed down by chips shortage

The shortage of semiconductor, Russia-Ukraine war, vehicle price hike, fuel price rise and other supply chain issues continue to weigh on buyer sentiment across the passenger vehicle market in India. In terms of pure numbers, the low base effect has kicked in and most OEMs are in the green compared to the marginal sales seen last April as the country tackled the scourge of Covid-19.

Maruti Suzuki India: 121,995 units / -10%
India’s leading car manufacturer, Maruti Suzuki India’s domestic sales including UVs and vans fell to 121,995 units as against 135,879 units in April 2021, a fall of 10 percent. The company sold a total of 150,661 units in April 2022. Compared to last month also there is a significant decline. The April sales slipped nine percent from 133,861 units sold in March 2022.

In a statement, the company said the shortage of electronic components had a minor impact on the production of vehicles, mainly domestic models. Maruti said it has taken all possible measures to minimise the impact.

On the exports front, the numbers for April were 18,413 units as against 17,237 units in April 2021. The company has been focusing on export models in a major way as the chips required for these models are more easily available.

Maruti recently launched the updated XL6 while the other products planned in the near future will include an updated Brezza in the entry level SUV space, followed by the five-door off-roader Jimny. Also in the works is a mid-size SUV to rival the Kia Seltos and Hyundai Creta, which will have both the Toyota and Suzuki badges.

Hyundai Motor India: 44,001 units / -10 %
Hyundai Motor India clocked 44,001 units in domestic sales in April 2022, registering a 10.2 percent year-on-year decline compared to 49,002 units sold in April 2021. In March 2022, Hyundai sold 44,600 units which is a mere 1 percent drop in MoM sales. The degrowth can be attributed to the global supply chain woes.

The Korean carmaker’s FY22 performance is  marginally better over FY21, registering a 2 percent growth to 481,500 units (FY21: 471,535). The Korean carmaker has been seeing strong demand for some of its popular models like Creta – which continues to have a waiting period of 8-12 months, depending upon the variant and city. Other models including the Hyundai i20 premium hatchback, Venue compact SUV as well as Aura compact sedan, particularly in its CNG trims, are witnessing strong demand.

Tata Motors: 41,587 units/ 66%
Tata Motors sold 41,587 units in domestic sales in April 2022, registering a significant 66 percent year-on-year growth compared to 25,095 units sold in the same month last year. In March 2022, the company sold 42.295 units, maintaining a flat trajectory on a MoM basis.

Out of the total volumes, Tata’s internal combustion models sold 39,265 unit (April 2021: 24,514 / +60%), while its electric drivetrain models including the Nexon EV, Tigor EV and Xpres-T, witnessed a four-fold growth with 2,332 buyers.

Despite global supply chain constraints, Tata Motors has been agile in its planning and management of the crisis situation over the last one year, making it post a noteworthy performance in FY22.  The company recently unveiled two brand-new concepts – Tata Curvv – which will spawn a future electric and ICE SUV  as well as the Tata Avinya – that will give birth to mid-size SUVs in a pure-EV architecture with an aim to offer driving range of over 500km on a single charge. The first SUV based on the Avinya will arrive in the market by 2025.

Mahindra & Mahindra: 22,526 units / 23%
Mahindra & Mahindra in the passenger vehicle segment sold 22,526 vehicles in April 2022. This is a 23 percent growth on the year-on-year with the company selling 18,285 units in the same period last year. Exports for the month were at 2,703 vehicles. In the previous month, Mahindra sold 27,386 vehicles which is a 18 percent degrowth.

According to Veejay Nakra, President, Automotive Division, M&M said, “We continued our growth trajectory in the SUV segment with sales of 22,168 vehicles registering a growth of 22 percent.”

Toyota Kirloskar Motor: 15,085 units / 57%
Toyota Kirloskar Motor (TKM) sold 15,085 units in April, posting a significant 57 percent year-on-year growth compared to 9,600 units sold in April 2021. The company posted a 12 percent drop in the month-on-month sales where they sold 17,130 units in March 2022. The rise in numbers comes on the back of a low year-ago base when the second wave of Covid in India had resulted in a slowdown in demand for cars.

 TKM, which continues to witness strong demand for its Fortuner SUV and Innova Crysta MPV, had also introduced two price hikes of up to Rs 250,000 on the Fortuner between January and April 2022. Starting May 1, it has also hiked prices of the Glanza and Urban Cruiser, citing rising input costs but said in a statement that the overall impact has been tapered down to minimise impact on consumers. The company is jointly developing a brand-new midsized SUV with Maruti Suzuki India and is likely to showcase the new product later this year.

MG Motor India: 2,008 units/ -22%
MG Motor India reported sales of 2,008 units in April 2022 as production was impacted by the global supply chain constraints and remained volatile. The company had clocked sales of 2,565 units last April which was also impacted by Covid-19 and witnessed lockdown in many regions in the country. The company in a statement said that it expects the situation to improve gradually within 6-8 weeks. MG Motor also witnessed a 57 percent decline in the MoM sales. (March 2022: 4721 units)

It added that Hector, Astor, and Gloster continue to exhibit positive momentum in enquiries and bookings. The all-new ZS EV continues to garner a strong customer response with over 1000 bookings month on month. To further strengthen the EV ecosystem, MG Motor recently partnered with Bharat Petroleum for setting up EV charging infrastructure across the country.

Skoda Auto India: 5,152 units / 436%
Skoda Auto (India) reported 5,152 units of domestic sales in April 2022, an increase of 436 percent, as against 961 units registered in April last year. April's sales performance is the second highest number of units sold in a month ever, after March 2022 when the company recorded 5,608 units, a 8 percent decline. The company attributed the consistent sales numbers to its increasing network expansion, increased customer touchpoints. 

Zac Hollis, Brand Director, Skoda Auto  India, said, “The Slavia is a resounding success while the Kushaq SUV continues finding newer homes. We have already crossed 190+ touch points so far and will only expand further. This ‘Beyond the Product’ approach is seeing us record consistent sales month on month.”

Growth Outlook
Though there are select green shoots of revival trying to get a toe-hold, it will be wrong to conclude that the industry is completely out of the woods. Supply side headwinds in the form of raw material shortage and high commodity prices continue to be an overhang and a key point of concern. Most OEMs are betting on a variety of variants to drive sales.

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