UV sales give cause for cheer

Utility vehicles, once again saved the day for passenger vehicles in July with the segment recording a 61.57 percent growth from 27,777 units to 44,878 units. Pure passenger cars did quite well with 6.7 percent growth to 143,496 vehicles. Maruti accounted for close to 60 percent at least; this figure could have been higher if it were not for the lockout at its Manesar plant which rolls out some of its best-selling models.

In the CV segment, the effects of a slowing economy are more than evident. The medium and heavy CV goods carrier segment fell 18 percent to 18,883 from 22,955 units in July 2011. Sales of buses went up marginally in the absence of many government-sponsored initiatives that enable state-owned undertakings to buy new buses. Bus sales in recent years have been the outcome of JNNURM which resulted in a sea-change in the kind of buses that ply in the metros and Tier-1 cities.

Sales of small CVs would have brought cheer to their manufacturers, increasing 14 percent to 36,778 units but the CV sector has a whole rose by just over 1.20 percent YoY in July.

In the two-wheeler segment, scooters saw a 20 percent growth on a smaller base while motorcycles rose by just five percent. This sector is petrol-driven and this slow growth reflects the decision of buyers to put their purchases on hold till the festive season.

SIAM has already gone on record to predict that two-wheeler sales will see a growth rate of about 10-11 percent in 2012-13 but much will depend on the monsoon which has not been as good as expected.

The government has not yet announced any increase in diesel prices even though its think-tank says it is imperative. With the government struggling to contain inflation, a decision on increasing diesel prices will not likely be made in a hurry. Ironically, the massive power outages over July 31 and August 1 in north India saw a surge in diesel sales, even as it exposed the fragility of India’s infrastructure.

BRIAN DE SOUZA