April 2, 2013: With most OEMs announcing their March 2013 sales numbers, it is amply clear that the flurry of handsome discounts offered in the last month of fiscal 2012-13 did not click with buyers. A dampened economic sentiment, high interest rates and rising fuel prices continue to play spoilsport. Given this situation, a smart recovery is not expected in the new fiscal, 2013-14.
Maruti Suzuki India, the bellwether of the Indian automobile industry, sold a total of 107,890 units in March 2013 (March 2012: 112,724), down 4.3 percent. Its entry level pack (800, Alto, A-star, Wagon R) sold 45,047, down 14.7 percent over the 52,826 units sold in March 2012. Sales of the Swift, Estilo, Ritz were also down by 7.3 percent: 25,868 units in March 2013 compared to 27,913 a year ago. The SX4, which is fast falling out of favour with consumers, sold 903 units, down 40.6 percent (March 2012: 1,520).
However, Maruti has two huge winners in its Dzire saloon and Ertiga MPV. The Dzire sold 20,078 units in March 2013, notching 22 percent growth (March 2012: 16,451). And the Ertiga sold the bulk of the 6,488 units in its category (along with the Gypsy and Grand Vitara). Maruti is believed to be working on a CNG-powered Ertiga, which is slated for launch in a couple of months.
For the entire fiscal year 2012-13, Maruti sold 1,051,046 units in the domestic market (April 2011-March 2012: 1,006,316), a growth of 4.4 percent. All said and done, the carmaker will be hard-pressed to deliver consistently improving sales numbers in the new fiscal. Along with a dampened market sentiment, high interest rates and fuel prices that are delaying new car purchases, Maruti has to contend with aggressive new rivals in the market.
The immediate threat will come from the soon-to-be-launched Honda Amaze, which has already sold 2,552 units (to dealers) in March 2013.
For Hyundai Motor India, the second largest carmaker, sales fell by 13.46 percent to 33,858 units (March 2012: 39,122). Commenting on the sales, Rakesh Srivastava, VP, sales and marketing, HMIL, said: “The slowdown of the economy is impacting vehicle sales. We foresee the pressure on volumes to continue till there is significant improvement in macro-economic factors.”
Mahindra & Mahindra registered total auto sales of 51,904 units in March 2013 (March 2012 : 46,919), an increase of 11 percent. Domestic sales stood at 49,225 units in March 2013 (March 2012 : 44,260 units), up 11 percent. The Passenger Vehicles segment (which includes UVs and the Verito saloon) posted a growth of 12.28 percent, with sales of 25,847 units in March 2013 (March 2012 : 23,020). For 2012-13 fiscal year, M&M sold 563,373 units as against 483,164 units, a 17 percent growth.
2013-14 will see M&M face new challenges in the form of the soon-to-be-launched Ford EcoSport SUV. The company is believed to be developing a range of new SUVs, including sub-compact models and also an all-new engine family that will power its future range of compact SUVs and passenger cars. It is rumored to be investing around US$ 800 million (around Rs 4,300 crore) in this project. The new engine family is likely to include three petrol and three diesel engines with capacities ranging from 1.2 to 1.6 litres. Developed on a modular architecture, the base 1.2-litre motors will be three-cylinder units, while the higher capacity 1.5 and 1.6-litre engines will have four cylinders.
Tata Motors’ sales continue fall sharply and in March 2013 the company sold 12,347 units, down nearly 67 percent (March 2012: 36,984). While sales of the Nano/ Indica/ Indigo range comprised 8,903 units, the Sumo/ Safari/ Aria/ Venture range sold 3,444 units.
Honda Motors India, which is all set to launch its all-new Amaze midsize saloon on April 11, sold 10,044 units in March 2013 (March 2012: 11,016), down nearly 9 percent.
Toyota Kirloskar Motor sold a total of 19,452 units in March 2013, a 6.76 percent increase of the 18,220 units sold in March 2012.
Ford India, which sold 5,271 units as against 9,026 units in March 2012, saw sales decline by nearly 42 percent.
General Motors India’s sales too were down, by 15 percent, to 9,006 units (March 2012: 10,588).
Renault India has posted an all-time sales high of 8,232 units in March 2013, an eight-fold increase year-on-year (March 2012: 1,005 units).
The popular Duster SUV was the biggest seller, accounting for 6,313 units, followed by the Scala (1,026), Pulse (541), Fluence (337) and Koleos (15).
“March was a tremendously successful month for Renault India, despite a challenging market,” said Sumit Sawhney, executive, marketing & sales, Renault India. “Not only did we achieve overall record-breaking sales, but we also surpassed our benchmarks for the Duster, Fluence and Scala, which is indicative of the continuing appeal and acceptability of our products among customers.”
Fiscal 2013-14 to remain a challenging year for cars
According to research agency ICRA, the new fiscal year will remain filled with challenges. The passenger vehicle (PV) industry’s domestic volume growth is expected to be just around 2 percent in 2012-13, as the small car segment that accounts for 55-60 percent of the industry’s volumes is likely to continue to grow at a rate slower than other PV segments.
Dealers have reported a worrisome drop in customer enquiry rates, both in urban markets as well as in smaller towns and rural areas, and are less sanguine about demand recovery over the near term.
ICRA says that profitability metrics of industry participants will be impacted over the near term in view of an increase in expenses related to launch of new models, increase in employee costs as several OEMs have announced substantial wage hikes, likely sustenance of discounts-led sales push, and restricted pricing power in the wake of intense competition.
Two-wheeler OEMs continue to face heat in March 2013
Industry leader Hero MotoCorp has reported sales of 468,283 units for March 2013, down by 11.36 percent over March 2012 sales of 528,290 units. It closed FY 2013 with total sales of 60,75,583 units against sales of 6.2 million units in FY 2012. Anil Dua, senior VP (marketing & sales), Hero MotoCorp, said: “The Indian auto industry faced an acute slowdown in FY’13. It continues to reel under the adversities of persistent inflation, firm interest rates, rising fuel prices and negative consumer sentiment. All these factors have adversely impacted the growth of the industry and our sales volumes. Going forward, we have planned new launches, new campaigns, capacity addition and network expansion to boost the sentiment of the domestic industry and accelerate growth. In the new financial year, we will also commence our international operations in several new markets to work towards our global vision.”
Sliding down by 11.24 percent, Bajaj Auto recorded total sales of 267,037 units (including exports) during March 2013 as against 300,848 motorcycles sold during March 2012. On the cumulative sales front, the company sold 3,757,105 motorcycles (April-March 13) as against 3,834,405 motorcycles (April-March 12), down by 2 percent.
Meanwhile, continuing to buck the trend, Honda Motorcycle & Scooter India (HMSI) reported sales of 252,773 units during the month, up by a substantial 12.8 percent (March 2012: 220.487). Bikes sales were robust at 120,738 units, up 47 percent, albeit on a low base of 82,353 bikes sold during March 2012. However, scooters at 132,035 units sold during the month saw a slight downfall of 4 percent (March 2012: 138,134 units). Total cumulative sales in FY13 saw a 31 percent growth with 2,754,685 units against 2,107,183 units sold during April-March 12.
Meanwhile, TVS Motor Company clocked in domestic sales of 143,239 units during the month, down by nearly 11 percent (March 2012: 160,736 units). Yamaha Motor India reported domestic sales of 35,782 units during March 2013 as against 29,819 units sold in March 2012, up by 20 percent.