INDIA SALES: PVs and CVs grow, motorcycles and 3-wheelers fall in H1

With the Society of Indian Automobile Manufacturers (SIAM) revealing the industry sales numbers for April-September 2015 (H1), it is amply clear that a sales recovery is some time away. Overall numbers have felt the heat of slowing two-wheeler sales, particularly motorcycles.

Sales of passenger vehicles grew by 6.22 percent in April-September 2015 over the same period last year. Within the passenger vehicles segment, passenger cars grew by 9.68 percent while sales of Utility Vehicles and Vans decreased by 2.56 percent and 1.46 percent during April-September 2015 over the same period. The overall commercial vehicles segment registered growth of 7.18 percent in April-September 2015 as compared to the same period last year. Medium and Heavy Commercial Vehicles (M&HCVs) registered growth of 33.68 percent while LCVs declined by 7.41 percent during April-September 2015 over the same period last year.

Three-wheeler sales declined by 10.05 percent in April-September 2015 over the same period last year. Passenger carrier and goods carrier sales declined by 10.43 percent and 8.19 percent respectively in April-September 2015 over April-September 2014

Two-wheeler sales registered a marginal decline of 0.36 percent in April-September 2015 over April-September 2014. Within the two-wheeler segment, scooters grew by 9.92 percent, while motorcycles and mopeds dropped by 4.06 percent and 5.21 percent respectively in April-September 2015 over April-September 2014.

Exports in H1
In April-September 2015, overall automobile exports grew by 7.68 percent. Passenger vehicles, commercial vehicles, three-wheelers and two-wheelers registered a growth of 3.89 percent, 19.5 percent, 23.43 percent, and 5.74 percent respectively in April-September 2015 over April-September 2014.

How September 2015 sales stack up
September 2015 sales marked another month of de-growth for the Indian automotive industry. While the passenger vehicle and M&HCV segments continued to post healthy growth, the onset of the festive season, low fuel prices and benign interest rates were not enough to jumpstart recovery in laggards like the motorcycle and the LCV segments.

According to data released by SIAM, a near-9.5 percent growth in passenger car sales in the month to 169,590 units helped the overall PV industry, which reported a 3.8 percent growth to 232,167 units. Sales of utility vehicles continued to decline and fell 8.6 percent to 48,464 units, despite fresh launches in the segment, and van sales also reduced 10 percent to 14,113 units.

M&HCV sales continued to grow, largely driven by replacement demand, and were up 64 percent in September to 31,172 units. Some advance buying by fleet owners ahead of the new safety norms that kicked in from October 1 also aided M&HCV sales in September. According to estimates, the compulsory fitment of ABS and speed limiters on M&HCVs is likely to bump up costs by up to 5 percent. 

Meanwhile, LCV sales continued to fall, mainly due to de-growth in the goods carriers segment. Total LCV sales in the month were down 14.5 percent to 31,673 units. Lack of last mile connectivity needs dragged down sales of LCV goods carriers by 17 percent to 28,181 units, while sale of passenger LCVs rose 15.36 percent to 3,492 units.

Two-wheeler sales in the month were marginally lower at 1.54 million units (September 2014: 1.55 million) as motorcycle sales fell 2.9 percent in September to 1.02 million units. Scooter sales continued on their good run and rose 6.5 percent to 462,341 units. Meanwhile mopeds lost their shine and sales came in 21.2 percent lower at 54,559 units in September.

Three-wheeler segment was another laggard in September and sales were down 13 percent at 49,524 units. 

With the fall in interest rates loans are set to become more affordable and this could see a spike in consumer demand for automobiles during the festive season. This could have a direct impact on PV and two-wheeler sales in the coming months. However, concerns surrounding demand for LCVs still remain and with overall economic activity remaining moderate it might take some more time before sales in the segment could pick up.

Also read INDIA SALES ANALYSIS: SEPT '15