After a buoyant September, PV sales subdued in October

As November opens, the sales numbers of passenger vehicles (PVs) sold in October 2017 in India have begun to be released by vehicle manufacturers. From the sales reported by the Top 4 OEMs and the general sales trend for the month, overall growth in the PV market seems to be subdued in comparison to the buoyancy of September 2017 when the industry clocked its best-ever month sales of 309,955 units (+11.32).

While the footfalls in showrooms and resultant sales were good till the first half of October and in the Diwali week, sales subsequently tapered off. Expect overall PV industry numbers to be around the 280,000 to 285,000 unit mark, more or less near October 2016 sales of 280,677 units.

Maruti Suzuki India, the bellwether of the industry, has reported sales of 135,128 vehicles in October 2017, a year-on-year growth of 9.5% (October 2016: 123,684). Its numbers are marginally lower than expected given that the festive season of Diwali, when consumers prefer to drive home their new set of wheels, was in mid- October itself. 

Its entry-level Alto and the Wagon R see a sales decline of 4.2 percent in October 2017 with 32,490 units (October 2016: 33,929), but the quintet of compact cars – Swift, Celerio, Ignis, Baleno and the Dzire – registered solid 24.7 percent growth with sale of 62,480 units (October 2016: 50,116). Expect the bulk of the contribution to these numbers to have come from the new third-generation Dzire compact sedan, which has set the sales charts afire for the company.

The Ciaz, the company’s sole C-segment offering, however, is on a downward path, clocking sales of 4,107 units (October 2016: 6,360), a sharp drop of 35.4 percent. What is giving Maruti sales the charge is the surging demand for its UV offerings particularly the Vitara Brezza. The company’s UV portfolio, comprising the Gypsy, Ertiga, Vitara Brezza and the newly introduced S-Cross facelift, sold 23,382 units last month, marking sizeable 29.8 percent growth (October 2016: 18,008).The two vans, the Maruti Suzuki Omni and the Eeco, sold a total of 12,669 units, which makes for flat growth of 0.9 percent (October 2016: 12,790).

Like Maruti, Hyundai Motor India, the No. 2 player, too has posted lower-than-expected sales. In October 2017, the Chennai-based manufacturer sold 49,588 passenger vehicles, down 0.8 percent (October 2016: 50,017).

Commenting on the October sales, Rakesh Srivastava, director - Sales and Marketing, said, “Hyundai did its highest retail of over 50,000 units in a festival month, with a wholesale of 49,588 units on the strength of strong demand for the Grand i10, Elite i20 and Creta. The new Verna has received a strong customer response with over 20,000 cumulative bookings and 150,000 enquiries.

Like Hyundai, Mahindra & Mahindra, the No. 3 domestic market player, too has felt the pressure of slowing sales. The UV major has witnessed a performance slump, despite the festive period generally giving a boost to sales. The company sold a total of 23,413 PVs in October 2017, a 5 percent de-growth (October 2016: 24,737). UVs, its forte, de-grew by 6 percent with models including the Bolero, Thar, TUV300, Scorpio, XUV500 and the Ssangyong Rexton clocking sales of 22,040 units (October 2016: 23,399).

However, the line-up of its cars and vans, including the KUV100 and the Verito performed marginally well, bringing in sales of 1,373 units (October 2016: 1,338), a 3 percent growth. The KUV100 has also been given an update by the company in the form of the KUV100 NXT and aims to improve on some of the aesthetics of the original model introduced in early 2016.

Rajan Wadhera, president, Automotive Sector, M&M, said, “The auto industry has had a mixed month in terms of sales in October. The build up to Dhanteras and Diwali was good but the demand tapered off subsequently. Last year, all festivals were in the month of October and the industry volumes had a high base. This year, September and October combined, we have grown by 7.9 percent in the auto division. Going forward, we enter into a year-end period of lower sales. Our refreshes and new variants, that have been launched, will carve out a niche and we expect to sustain the growth momentum for the remaining period of the current financial year.”

Tata Motors’ passenger vehicle division has recorded sales of 16,475 units in the domestic market, a growth of 1% over October 2016. According to the company, continued good performance of new- generation vehicles like the Tiago, Tigor and Hexa and the strong market response to the recently launched compact SUV, Nexon have contributed to the numbers.

For Tata, its cumulative sales in the domestic market for the fiscal (April-October 2017) total 97,892 units, a growth of 10 percent compared to 88,976 units, in the same period last fiscal. 

Commenting on the October sales performance, Mayank Pareek, president, Passenger Vehicles Business Unit, Tata Motors, said, “We continue to keep the sales momentum going, led by a strong product pipeline of the Tiago, Tigor and Hexa. We have successfully completed the launch of the Nexon across the country and are delighted with the response – it is currently witnessing a waiting period of around 8 weeks. We maintain cautious optimism in the market and hope to see this momentum continue.”

Toyota Kirloskar Motor sold 12,403 units in the domestic market in October 2017, a 6 percent year-on-year growth (October 2016: 11,651). The company also exported 1,597 units of the Etios series, thus clocking a total of 14,000 units registering 6 percent growth as compared to same period last year. 

According to the company, despite the price rise in line with the GST cess hike, customer demand for the Innova MPV and Fortuner SUV continues to be strong and the Bidadi plant capacity is being utilised to the maximum.  The newly launched limited editions Etios Cross X-Edition and Fortuner TRD Sportivo have also seen a good market response.

Commenting on the monthly sales, N Raja, director and senior vice-president, Sales & Marketing, TKM, “We are happy that the festive season has given a positive push to domestic sales in the auto industry.  There is a spur in the customer demand.  The Innova Crysta and Fortuner continue to enjoy good growth in demand and we are utilising one of our plants to the maximum capacity to ensure the waiting period is reduced.” 

TKM has also reported a slight  improvement in customer demand for the Camry Hybrid. 

Ford India has registered a weak performance with total domestic sales of 4,218 units (October 2016: 7,508), registering de-growth of 43.82 percent. According to Anurag Mehrotra, president and managing director, Ford India, “The ramp-up for new model introduction has impacted our wholesales for October.”

The company is all set to introduce the facelift of the compact SUV on November 9, with bookings to commence from November 2. The new EcoSport (pictured above) is set to receive a brand-new 1.5-litre three-cylinder ‘Dragon’ series petrol motor from the company, along with host of aesthetic and feature refreshes, and a brand new six-speed automatic gearbox, which will replace the earlier dual-clutch unit. Clearly, Ford India aims to try and revive the compact SUV’s sales in the country and better its market positioning.