January sales recover slightly

The pressure on automotive sales continued into the New Year with January passenger vehicle sales declining almost seven percent to 137,000 units compared to the same time last year. However, they were 38 percent higher than December 2008 sales of 99,000 units.

Autocar Pro News DeskBy Autocar Pro News Desk calendar 17 Feb 2009 Views icon3630 Views Share - Share to Facebook Share to Twitter Share to LinkedIn Share to Whatsapp
The pressure on automotive sales continued into the New Year with January passenger vehicle sales declining almost seven percent to 137,000 units compared to the same time last year. However, they were 38 percent higher than December 2008 sales of 99,000 units. The jump can be attributed to huge discounts on prices and the new model year effect. Sales in January normally get a boost as buyers opt to register their vehicles in the new model year, as this would fetch them a better price in the second hand market.

According to some car dealers, the cost of finance continues to remain relatively high, with interest rates of 14 percent per annum and approval times of 15 days, which have continued to put pressure on sales in January.

Even the April 2008 to January 2009 period saw passenger vehicle sales dropping 1.21 percent, over the same period in the previous year. During this time, passenger cars fell by 0.62 percent; utility vehicles were down 7.38 percent. However, multi-purpose vehicles grew 6.33 percent during this period.

The drop in commercial vehicle sales during January 2009 was much steeper at over 50 percent compared to last year, with around 23,000 units sold. But these sales were 29 percent higher than the 18,000 units sold in December 2008. While this is a positive sign, however it is unlikely that this jump in sales marks a sustainable recovery in demand for trucks across the country.

During the month, medium and heavy trucks sales fell 67 percent, light trucks fell by 30 percent, while medium and heavy buses fell by 14 percent. During April 2008 to January 2009, the segment declined 20 percent as compared to the same period last year with medium and heavy trucks dropping by 29 percent and light trucks recording a decline of eight percent.

Meanwhile, two-wheeler sales during January were 582,000, a drop of about four percent over last year. When compared to the previous month’s sales of 461,000 units however, it is a 26 percent increase.

As a result of these sales declines, overall production in January also declined by 12 percent over the same month last year, as manufacturers tried to avoid building up excessive inventory.

During April to January, two-wheelers registered a marginal growth of 1.27 percent. Mopeds and scooters grew by 3.36 percent and 8.42 percent respectively. Motorcycle sales declined by 0.30 percent, while the electric two-wheeler segment grew by 38.40 percent.

Three-wheeler sales registered declines as well with a drop of 6.49 percent during April to January 2009. While passenger carriers grew by 12.32 percent during this period, goods carriers declined 39 percent. In January itself, three- wheelers fell by 12.29 percent over the same month last year.

April 2008 to January 2009 also saw automobile exports growing 30.47 percent with all segments except commercial vehicles, showing positive growth. Passenger vehicles and two-wheeler exports grew 59.55 and 29.86 percent respectively, while three-wheeler exports increased by 10.88 percent.

However, exports of commercial vehicles declined by 18.99 percent during this period due to lower demand from overseas markets.

Xylo and Linea make a strong start

The recently launched Mahindra Xylo multi-purpose vehicle reported strong numbers in its debut month with sales of 1,788 units in just two weeks, with Mahindra claiming that bookings for the vehicle had crossed 4,000 units. Mahindra sales for the month of January were 17,320 units, as against 20,884 units in January 2008. Its domestic sales during April 2008 to January 2009 were 174,873 units, as against 177,470 units in the same period last year. The company sold a total of 17,611 vehicles in the Indian and export markets combined during January 2009, as against 22,309 vehicles sold in January 2008. Its exports were 291 units in January 2009, as against 1425 during the previous year.

Meanwhile, Italian carmaker Fiat also reported a good start for its new Linea saloon which sold 1,512 units during January, with the company reporting total sales of 1,721 units in the month.

The Linea recently won the UTVi-Autocar India Car of the Year 2009 award and is the model that Fiat hopes will turnaround its fortunes in the Indian market. Fiat has also just launched the 95 bhp, 1.4-litre petrol engine variant of the Linea recently, which supplements the existing 1.3-litre, 90bhp Multijet diesel engine.

Overall, January sales numbers have shown an improvement over December 2008, but it is still too early to say that this is a recovery.
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