Tata, Hyundai, Kia and Mahindra shine in November but carmakers hoped for more in festive season

The Indian passenger vehicle (PV) market has seemingly been rather quick in responding positively to the disruption caused by the Covid-19 pandemic, with ample proof of the beginning of asales recovery during the festive months of September and October, which recorded healthy double-digit growth, 35 percent and 15 percent, respectively.

However, with the GDP in negative territory, a lot of dark clouds are still hovering around the complete economic revival, and experts believe that the festive season sales to be high on account of the joyous mood of the buyer, as well as people starting to feel the increased need for personal mobility as various imposed restrictions start getting lifted.

Clearly, there have been doubts about sustained demand after the festive season and if November sales results of OEMs are anything to go by, these doubts are perhaps turning true. Compared to October 2020, overall November sales tallied 286,469 units, registering a 14 percent month-on-month de-growth (October: 333,659). But, at the same time, they show a 9 percent uptick with respect to 263,355 units sold in November 2019.

The trend can easily be gauged from industry bellwether, Maruti Suzuki’s numbers, which despatched 135,775 units last month – a decline of 2.4 percent. While other manufacturers have reported reasonable gains too, it is also on the back of excitement created by some newly-launched models as in the case of Hyundai, Kia and Mahindra & Mahindra, but, for the predominant part of the industry, the situation is still unclear whether the volumes are here to be sustained over the long term.

Let’s have a closer look at manufacturer-wise sales numbers for November 2020:

Maruti Suzuki India: 135,775 units (-2.4%)
As mentioned above, the company despatched a total of 135,775 units last month, reporting a 2.4 percent de-growth (November 2019: 139,133). What is alarming is the fact that the most affordable cars – its entry-level pair of Alto and S-Presso have registered a 15 percent decline to go home to 22,339 buyers (November 2019: 26,306).

On the other hand, the pack of compact cars which includes the WagonR, Swift, Baleno, Ignis, Dzire, Celerio and Tour S also reported a negative growth of 2 percent with total sales touching 76,630 units (78,013). The same cars had achieved sales of 95,067 units in the previous month of October 2020.

While the Ciaz sedan also remained a low seller at 1,870 units (1,448 / -29%), the UV quintet of the Gypsy, Ertiga, S-Cross, Vitara Brezza and XL6 sold a total of 23,753 units (23,204 / +2.4%).

Hyundai Motor India: 48,800 units (9.4%)
In contrast to Maruti Suzuki, India’s No. 2 carmaker by sales volumes, Hyundai Motor India reported a 9.4 percent uptick owing to festive demand with total domestic despatches of 48,800 units (44,600).

While the carmaker launched the new Hyundai i20 premium hatchback on November 5, the major sales pull is coming from the latest generation Creta SUV which is having a dream run in the Indian market, having garnered over 115,000 bookings since launch earlier in March.

Commenting on the performance, Tarun Garg, director, Sales, Marketing and Service, Hyundai Motor India, said, “Building on the strong sales momentum that was driven by festive demand this year, we continue to build high customer excitement through the line-up.  As the smart Indian customer continues to make smart mobility choices, the recently introduced i20 has helped carry forward the festive momentum even in the post Diwali period for Hyundai Motor India.”

Tata Motors: 21,641 units (108%)
The star of the show in the sales tally is homegrown carmaker Tata Motors, which registered a significant uptick of over 100 percent with total sales scaling to 21,641 units (November 2019: 10,400 / 108%).

A renewed demand for its Nexon crossover’s facelift, as well as the 2020 Tata Harrier flagship SUV which now also offers an automatic gearbox, has led Tata Motors witness this strong surge in market demand, notwithstanding the fact that even entry-level cars like the Tiago and Altroz premium hatchback are wooing customers with their top-safety marks achieved in crash tests conducted by Global NCAP.

Kia Motors India: 21,022 units (50%)
The Korean carmaker too has only good news to share about its sales performance for November. The company despatched a total of 21,022 units, registering a 50 percent year-on-year uptick (November 2019: 14,005).

The new Kia Sonet compact SUV has been leading the charge for Kia with sales of 11,417 units, also making it the top-selling CSUV in the month. The remaining volumes predominantly include the bigger Kia Seltos, which garnered volumes of 9,205 units.

According to Kookhyun Shim, managing director and CEO, Kia Motors India,“I am delighted to witness the wide acceptance we have received in India for our vehicles. Since the Covid-19 outbreak, we were quite hopeful about the festive month and the results are overwhelming. Not only urban, but customers from Tier 2,3 and 4 markets too are acknowledging the need for personal mobility to maintain personal safety.”

“While there is still a lot of uncertainty in the market due to the pandemic, the overall consumer sentiment has significantly improved and we are all prepared to offer a safe and hassle-free ownership experience to our customers. We are expecting the market sentiment to improve more in coming months and we are confident that we will be able to continue this positive momentum in future as well,” Shim added.

Mahindra & Mahindra: 18,212 units (24%)
UV specialist Mahindra & Mahindra (M&M) too reported an uptick of 24 percent in sales which culminated at 18,212 units (November 2019: 14,637). The driving factor for M&M has been its pack of UVs, within which the all-new Mahindra Thar is one of the prime reasons to have played a key role in reenergising the market even in a damp business environment.

Launched on October 2, the Thar has gone on to receive bookings of over 20,000 units and is running waiting periods of about six months, prompting M&M to ramp up production by up to 50 percent to cater to the surge in demand. What will further help the Thar’s case is that the body-on-frame SUV has gone on to score a respectable four-star rating in the recent Global NCAP crash tests.

According to Veejay Nakra, chief executive officer, Automotive Division, M&M, “At Mahindra we are happy to achieve strong double digit growth in SUVs during the month of November, aided by a robust festive demand for all our products.  Given strong rural growth and signs of improvement in economic activities, we are hopeful to see this positive momentum continue post the festive season.”

Honda Cars India: 9,900 units (55%)
The Japanese carmaker’s Indian arm also reported a robust 55 percent uptick in November with despatches of 9,990 units as against 6,459 units despatched in the same month last year. The new Honda City is finally finding reasonable traction in the market, followed by Honda’s refreshed portfolio which also offers some added features along with the BS VI engine upgrade.

Speaking on the sales performance, Rajesh Goel, SVP and director, Marketing and Sales, Honda Cars India, “The festive season this year was good for us with sales improving by 55 percentand contributing to overall industry growth.”

“While the Amaze continues to show strong market performance, the all-new City has been fuelling the demand in midsized sedan segment since its launch and maintaining its leadership position month after month.Although there are continuing challenges of pandemic and its impact on overall consumer sentiment, the rise in personal mobility is expected to help us sustain our sales momentum during the rest of fiscal year,” he added.

MG Motor India: 4,163 units (28.5%)
Instead of the wholesales numbers as reported by other car manufacturers, MG Motor India retailed a total of 4,163 units in the month to register a 28.5 percent uptick (November 2019: 3,239). The sales came primarily on the back of its Hector and Hector Plus twins, which went home to 3,426 buyers.The remaining volumes included 110 units of the MG ZS EV crossover and 627 units of the flagship MG Gloster, which was launched on October 8 and has garnered over 2,500 bookings so far, as claimed by thecompany.

According to Rakesh Sidana, director, Sales, MG Motor India, “Buoyed by continued festive demand and the sustained demand for the Hector and ZS EV alongside the successful launch of the MG Gloster, we have recorded 28.5 percent growth in November 2020 compared to last year. We expect the momentum to continue in December and expect to close this year on a strong note.”

Toyota Kirloskar Motor: 8,508 units (2.4%)
Toyota Kirloskar Motor (TKM) has reported sales of 8,508 units in November 2020, which is a year-on-year increase of 2.4 percent (November 2019: 8,312). In October, the Bangalore-based carmaker had sold 12,373 units (4.27%) and 8,116 units in September.

Commenting on the November performance, Naveen Soni, senior voice-president (Sales & Service) TKM said, “The company has been witnessing a gradual yet steady recovery owing to factors such as pent up and festive season demand as well as consolidation of the market at the lower end due to increasing preference for personal mobility amongst customers.”

“In terms of festive season demand and sales, TKM has fared well registering a 10-13 percent increase in customer orders and 12 percent increase in retail sales when compared to the festive period in 2019. However, owing to the illegal strike called upon by the members of TKM union, TKM was forced to declare a lockout at the factory which has impacted our production & wholesale numbers (sales from TKM to dealer). Having said that, we have been able to fulfil the market demand with the stock available with us, both at the factory as well as at the dealer’s end, and we are trying our best to ensure that ‘Customer Orders’ are prioritised by channelising the available resources,” he added.

With the festive demand now out of the way, it would be interesting to see how the market responds in the coming months, especially December which even in a routine scenario sees sales being pushed by heavy year-end discounting and customer offers.

According to Nikunj Sanghi, veteran automobile dealer and managing director, JS4Wheel Motor, “The year-end discounting scenario will actually depend on the kind of inventory build-up at dealers. With States like Maharashtra, Gujarat and Tamil Nadu still facing supply chain constraints causing disruptions at component manufactures as well as OEMs, my personal feeling is that it would be lower compared to previous years.”  

While the pent-up demand is also speculated to last until the end of the fiscal, sincere efforts from carmakers to excite the market in the form of bringing new models, could just be the trick to keep the numbers rolling. Nissan Motor India, then, is all set to introduce the Nissan Magnite compact crossover in the market on December 2, and how it leverages the current upsurge in the compact UV segment to turn the tide around for the company, will be something to watch out for.