Supply chain bottleneck continues to strangle PV sales in January

With the global chip shortage extending well into the new calendar year, OEMs continue to face production challenges, clearly visible from their wholesale numbers announced for the month of January. However, there is improvement in performance if the numbers are viewed from a month-on-month perspective.

The bellwether of India’s passenger vehicle segment – Maruti Suzuki India – reported a 7 percent year-on-year (YoY) decline in sales, arising out of the semiconductor supply constraints. The company also saw its entry-level models including the Alto and S-Presso register a 25 percent YoY decline, also indicating at a weak market sentiment, spurred by the pandemic and sky-high fuel prices.

Let’s take a look at company-wise sales numbers of the key carmakers for last month:

Maruti Suzuki India: (128,924 / -7.25%)
The company reported cumulative wholesales of 128,924 units, down 7.25 percent compared to 139,002 units sold in January 2021. Sales of the Alto and S-Presso were down 26 percent to 18,634 units (January 2021: 25,153).

While the septet of Baleno, Swift, Ignis, Dzire, Tour S, Celerio and WagonR also reported a 7 percent drop in sales to 71,472 units (76,935), the utility vehicle set of Ertiga, Gypsy, S-Cross and XL6 registered a handsome 12 percent uptick to sell 26,624 units (23,887). The Ciaz sedan reported a 24 percent growth in sales as well to go home to 1,666 buyers (1,347).

Hyundai Motor India: (44,002 / -15%)
Korean carmaker regained its lost spot in December 2021 to Tata Motors, by selling a cumulative 44,022 units in January. However, the numbers were down 15 percent YoY compared to 52,005 units sold in January 2021.

The company said in a statement that it is monitoring the global chip shortage and will make all efforts to meet customer demand. The waiting period on some of its popular models like the Creta, i20 and Aura CNG are soaring to up to 16 weeks depending upon the model and city.

Tata Motors: (40,777 / +51%)
The homegrown carmaker again sprung up a surprise last month with its wholesale numbers crossing the 40,000-unit mark for the first time ever, and the carmaker registering sales of 40,777 units – its best ever so far. December 2021 sales were pegged at 35,299 units.

Tata’s January sales post a notable 51 percent YoY uptick over previous year’s 26,978 units. The company registered a 43 percent uptick in sales of its conventionally-fuelled cars which went home to 37,885 buyers, while EVs registered over five-fold growth from selling 514 units in January 2021 to 2,892 units last month.

Tata Motors also claims that SUVs, at 28,108 units, comprised 69 percent of its total January sales while CNG models went home to 3,000 buyers. On January 19, the company entered the factory-fitted CNG segment with the launch of the Tiago and Tigor i-CNG, which contributed 42 percent of all sales of the two models in the debut month itself.

The agile performance of the carmaker is a hint of its superior handling of the global chip shortage compared to other manufacturers.

Mahindra & Mahindra: (19,964 / -3%)
Mahindra & Mahindra (M&M) sold 19,964 units in January, registering a 3 percent YoY decline (January 2021: 20,634). The company is riding high on demand for its two recent models – Thar and XUV700 – which accomplished the milestone of receiving 100,000 bookings since launch in October 2021.

As per M&M, the company has billed 14,000 XUV700s to its dealers and is maximising its efforts to reduce waiting periods, which are soaring to several months across India.

According to Veejay Nakra, CEO, Automotive Division, M&M, “Despite various global supply chain challenges, we fulfilled our commitment of billing the first 14000 XUV700s by January 2022 and have registered close to 1,00,000 bookings since launch, a major milestone in the Indian SUV industry. We continue to closely monitor the semi-conductor related parts issue and take corrective action as appropriate.” 

Kia India: (19,319 / +1.4%)
The Korean carmaker clocked wholesales of 19,319 units last month, registering a marginal 1.4 percent YoY uptick over January 2021’s 19,056 units. The Seltos SUV continued to lead the charge for Kia India’s sales and contributed to over 59 percent of the January 2022 numbers, with 11,483 units going home to buyers.

The company is gearing up to introduce its fourth product – the Kia Carens – in the market and aims to redefine the six- and seven-seat people-mover segment.

According to Hardeep Brar, VP and Head of Sales & Marketing, Kia India, “The month of January has been truly overwhelming for us, with our newest offering Kia Carens, receiving a record response with 7,738 bookings in just 24 hours. The Carens will further strengthen our positioning in the Indian market.”

Honda Cars India: (10,427 / -7.88%)
Honda Cars India despatched a total of 10,427 units to dealers last month, registering an 8 percent YoY de-growth over January 2021’s sales numbers of 11,319 units.

The company attributed a part of the decline to the temporary weekend lockdowns which were reinstated in some cities to curb the spread of the coronavirus in the Omicron wave. According to Yuichi Murata, director, Marketing and Sales, HCIL, “The sales in the month of January got partially impacted owing to the weekend lockdowns in some cities but overall, the situation looks positive and steady. HCIL’s products have been getting despatched to our dealer partners in time, meeting the demand for Honda models. The market situation will improve with the reduction in the Covid caseload as we move forward.” 

Toyota Kirloskar Motor: (7,328 / -34%)
The Japanese carmaker’s wholesale dealer despatches clocked 7,328 units last month, registering a 34 percent YoY decline (January 2021: 11,126).

While it launched the updated Camry Hybrid last month, TKM reached the 100,000-unit sales milestone for its Glanza and Urban Cruiser – models bought from alliance partner Suzuki. The company claims these two cars have helped it tap 66 percent of the first-time buyers in the Tier I and Tier II markets.

According to Atul Sood, AVP, Sales & Strategic Marketing, TKM, “Both Innova as well as Fortuner continue to pique interest, as both the models have robust customer orders and this has increased our order pipeline significantly.”

Nissan Motor India: (4,250 / +5.7%)
Nissan’s wholesales in January 2022 were pegged at 4,250 units, leading to a 5.7 percent YoY uptick compared to year-ago sales of 4,021 units.

The Nissan Magnite continues to pull demand for the carmaker which is on strong grounds in the entry-level compact crossover segment in the Indian market. According to Rakesh Srivastava, MD, Nissan Motor India, “Nissan India registered a cumulative growth of 203 percent YTD on the strength of strong demand for the Magnite, therefore, overcoming the headwinds of Covid-19 and lower supplies due to semiconductor shortage.”

The Magnite has garnered over 78,000 as per the company’s claims and over 42,000 units have been produced since its launch in December 2020, at the carmaker’s plant in Chennai.

MG Motor India: (4,306 / +20%)
MG Motor India too bucked the trend and registered a notable 20 percent YoY uptick in January sales with 4,306 units getting sold to customers through its showrooms across India. Company’s sales in January 2021 were pegged at 3,602 units.

However, the carmaker has cautioned facing challenges with the global chip shortage and supply chain constraints that continue to hamper production at its Halol plant in Gujarat.

Skoda Auto India: (3,009 / +200%)
The Czech carmaker registered a notable three-fold growth in sales which climbed to 3,009 units last month, compared to 1,004 units in January 2021.

The charge for the company’s revival is led by the India-specific Skoda Kushaq, which was launched in June last year and comes with over 90 percent localisation levels. According to Zac Hollis, brand director, Skoda Auto India, “We couldn’t have asked for a better start to the new year and it provides us with the right impetus needed to fulfil the targets we have set ourselves for 2022. We are looking forward to the rest of the year and are excited about the upcoming launch of Slavia, which along with Kushaq will drive our volumes going forward.”

The company is gearing up for the launch of the Slavia midsize sedan, which is slated to go on sale in March and rival the likes of the Honda City, Hyundai Verna and Maruti Suzuki Ciaz.