If October, which was a unique month with Dhanteras-Navrati-Diwali packed in it, could deliver flat sales of 285,027 units (0.28%), then it will be difficult for November numbers to better that. A slowing economy, no growth revival catalyst like a scrappage policy being announced by the government and dampened consumer sentiment are playing havoc with sales numbers. So, it comes as no surprise that of the passenger vehicle OEMs which have reported their November 2019 numbers, all but two have registered month-on-month declines (see data table at the end of this report).
Cumulative numbers of seven passenger carmakers indicate a total of 221,405 units being despatched to showrooms across the country, which marks a year-on-year decline of 7% (November 2018: 236,279) and a 6.8% month-on-month decline (October 2019: 2378,604).
For PV market leader Maruti Suzuki India, 139,133 unit sales last month are down 3.3% over those in November 2018 (143,890). The month-on-month growth is only 12 units if you compare November 2019's 139,133 units to the 139,121 units of October 2019.
Having recorded growth in October 2019, which came after seven straight months of sales declines albeit due to festive season demand, it was felt that November sales would move in the same trajectory. But clearly the passenger vehicle industry, and the overall industry, is not out of the woods yet. The fact is that sustained growth seems far away and if Maruti Suzuki India, which has 49% of the PV market share, has seen tepid November numbers then it looks like the rest of the industry will follow. The recent news that the country's GDP has slowed down even further to 4.5% does not bode well for the near future either.
Hyundai Motor India, the No. 2 PV player, recorded domestic market sales of 44,660 units, up 2.03% year on year, but down 11 percent on October 2019's 50,010 units. Commenting on the November sales performance, Vikas Jain, National Sales Head - Hyundai Motor India said, “Despite ongoing market challenges, Hyundai Motor India showcased a good performance by the Grand i10, Nios, Venue, Creta and Elite i20."
Utility vehicle manufacturer Mahindra & Mahindra, with despatches of 14,637 units, saw sales decline 9.58% YoY (November 2018: 16,191). But compared to October 2019's 18,444 units, November 2019 numbers are down 21% month on month. It's a sentiment echoed by the company spokesperson. Commenting on the performance, Veejay Ram Nakra, Chief of Sales and Marketing, Automotive Division, M& M, said, “The month after the festive season is historically a lean month for the automotive industry. Consumer demand, especially for passenger vehicles, typically picks up in the year-end that is in December. Therefore, we expect December to pan out better for the automotive industry.”
Tata Motors, which is readying for a new model assault in 2020, starting with the Nexon EV, premium Altroz hatchback and followed by the Gravitas SUV, sold a total of 10,400 units in November 2019, down a sizeable 38.75% YoY (November 2018: 16,982). Compared to October 2019's 13,290 units, sales last month are down 22%.
According to Mr. Mayank Pareek, president, Passenger Vehicles Business Unit, Tata Motors, “After an encouraging festival period, in November, industry declined sharply. In addition, industry is also preparing for the BS VI transition. In line with our strategy to focus on retails, we have further enhanced our network coverage. Our retail sales were more than wholesales by 15%, which has helped us to reduce the network stock by 35% in this fiscal. We will continue with these steps that make our network agile and profitable. We are ready for the transition to BS VI with enhanced models in both petrol and diesel options and have a slew of exciting new product launches in the coming months like Nexon EV, Altroz and Gravitas. These, along with the demand for the limited number of remaining BS IV diesel vehicles, coupled with an expected gradual improvement in consumer sentiment should help step change our growth trajectory in the coming months.”
Honda Cars India, with sales of 6,459 units, has seen a YoY decline of 50% (November 2018: 13,006) and a 23% decline over October 2019's 10,010 units.
Volkswagen India announced sales of 2,937 units in November 2019, up 17.43% YoY (November 2018: 2,501), one of the two carmakers to record growth albeit on a low year-ago base. Steffen Knapp, Director, Volkswagen Passenger Cars said, “We are extremely delighted with our performance last month. The consecutive growth reinstates the trust and preference of our customers in Volkswagen. Amidst tough market conditions, the brand has consistently delivered its value proposition to customers in this region.”
MG Motor India, which is set to launch its first electric vehicle in India, the MG ZS, later this week, reported despatches of 3,239 units in November 2019, which is 8.39% down on October 2019's 3,536 units.
It will be another week or so before all 17 OEMs, which reveal their sales numbers to industry body SIAM, announce their performance for November 2019. But the writing on the Indian automotive wall is clear: the going ahead is going to be slow.
Also read: Kia Motors India sells 14,005 units in November
Maruti Suzuki sells 139,133 units in November, down 3.3% YoY
Maruti Suzuki India cruises past the 20 million sales mark
India's GDP slows to 4.5% in Q2 FY2020, M&HCV sales to continue to bear the blow