Vehicle Wholesales Show Healthy Growth in September

Vehicle sales reflected an upsurge in September 2016, due to record despatches by OEMs to the dealers ahead of festive season. Passenger car and two-wheeler sales registered healthy double-digit growth, with some of the OEMs recording their highest monthly sales numbers. Commercial vehicles and 3-wheelers were, however, in slow lane. Total domestic sales, across vehicle categories, at 2,260,992 units in September, were up 20.2% y-o-y.

Passenger vehicle sales in top gear

Thanks to the good monsoon rains and implementation of 7th Pay Commission recommendations & OROP and consequent improved sentiment, OEMs built up stocks at the dealerships to cash in on the ensuing festive season. As a result, domestic passenger vehicle wholesales leapfrogged by 19.9% to 278,428 in September 2016 from 232,170 units a year ago.

Setting the pace, the car market leader Maruti Suzuki India (MSI), recorded its highest ever passenger vehicle sales during the month – a staggering 148,895 units, including exports.  Domestic passenger vehicle sales of Maruti Suzuki soared by 29.4% to 137,277 units in September 2016, while the exports at 11,618 units were up 51.4% y-o-y. 

The entry-level duo of the Alto and Wagon R posted domestic sales of 44,395 units, up 24.8% over 35,570 units in September 2015. The compact car quintet of MSI, comprising Swift, Ritz, Celerio, Baleno and Dzire sold 50,324 units in domestic market, clocking a growth of 12.3% y-o-y, thanks to the high demand for Baleno. The company saw 18,423 units of its UVs being sold in the Indian market, which marked a whopping 191.0% increase vis-à-vis 6,331 units in September 2015.

Domestic sales of Hyundai Motor India Ltd (HMIL) were more or less flat at 42,605 units in September 2016, crawling up by just 0.2% y-o-y. The Korean carmaker’s exports at 16,606 units during the month, however, grew by 18.3% y-o-y.

Home grown UV major, Mahindra & Mahindra (M&M) registered domestic sales of 20,537 passenger vehicles in September 2016 as against 19,564 passenger vehicles during September 2015, a growth of 5%. This number comprised of 19,206 UVs (+ 2.6%) and 1,331 cars and vans (+57%).

Pravin Shah, President and Chief Executive (Automotive), M&M, said, “A good and near-normal spread of monsoon, as well as new vehicle launches, have helped the auto industry perform positively. We do hope that the upcoming festive season brings in better demand due to improved sentiment.”

Tata Motors, another home-grown player, was also in fast lane. The company sold 16,351 passenger vehicles, including cars, UVs and vans, in the local market, which represented a 21.2% growth, compared to 13,488 passenger vehicles sold in Sep’16. The growth was largely driven by the company’s latest offering – Tiago that continued to clock good numbers.

Toyota Kirloskar Motor (TKM) sold 12,067 passenger vehicles in the domestic market, thereby registering a 6.1% growth y-o-y. In addition, the company exported 1,095 units of the Etios series.

“The unfortunate unrest in Bangalore and the imposition of Section 144 in the State resulted in a two-day production shutdown, impacting our commitment of on-time delivery of cars and parts to our customers. However, we have resumed production at our Bidadi plant and are geared up to meet demand during the upcoming festive season,” commented N Raja, Director and Sr Vice President (Sales & Marketing), TKM.

Ford India maintained the growth momentum, with the company’s domestic sales rising by 9.0% to 9,018 units in September 2016 from 8,274 units a year earlier. The company’s exports, on the other hand, witnessed a 4.1% y-o-y decline to 13,572 units during the month.

Riding on the runaway success of its sub-compact car – Kwid, Renault India witnessed a towering 581.8% growth in domestic sales of passenger vehicles, which stood at 12,143 units in September 2016, vis-à-vis just 1,781 units a year ago.

Renault’s alliance partner, Nissan Motor India reported domestic sales of 4,948 units in September 2016 versus 2,616 units a year ago, which reflected a healthy growth of 89.5%, thanks to the significant contribution of RediGo to the sales tally. The company exported 11,999 passenger vehicles – up 19.5% y-o-y.

Commenting on the sales results, Arun Malhotra, MD, Nissan Motor India, said, “Datsun RediGo sales continue to be strong and we are delighted by its acceptance by consumers in India.”

Meanwhile, Honda Cars India Ltd (HCIL) continued to face rough weather, witnessing slide in its domestic sales. The Japanese carmaker despatched 15,034 units in September 2016 - down 18.8% y-o-y. The model-wise break-up the company’s domestic sales read: City (5,855 units), Amaze (2,861 units), Jazz (2,608 units), Brio (1,209 units), BR-V (2,193 units), CR-V (47 units) and Mobilio (261 units).

Two-wheelers on fast track

Two-wheelers were in fast lane, due largely to the improvement in buyer sentiment and the rural economic environment as a result of the decent monsoon this year after two successive years of drought, Total domestic two-wheeler sales vroomed to 1,868,993 units, clocking an impressive 21.6% growth y-o-y. Most of the 2-W OEMs achieved new highs in sales.

Two-Wheeler market leader, Hero MotoCorp reported its highest-ever monthly sales in September 2016. The company sold 674,961 units (including exports) in September, growing by 11.2% over 606,744 units in September 2015. The company’s previous highest was recorded in October 2015, when it had reported total sales of 639,802 units. Domestic sales of Hero MotoCorp at 654,581 units were higher by 11.0% y-o-y, while the exports grew by 19.2% to 20,380 units during the month.

In terms of Y-T-D cumulative sales, the company reported sales of 3,568,887 units in H1 FY2016-17 – its best-ever H1 performance in any financial year. The company’s previous highest H1 sales was recorded FY’15, when it had sold 3,407,652 units during the period.

Breaching the 500,000 unit mark for the first time in India, Honda Motorcycle and Scooter India (HMSI) also reported its best-ever performance in September 2016. Honda’s monthly sales skyrocketed to 568,828 units (including exports) in September 2016. The domestic sales for the month stood at 539,473 units, a 31.1% growth over 411,645 units in September 2015. HMSI’s scooter sales crossed the 350,000 unit mark for the first time and peaked at 355,688 units in September 2016, growing by 34.5% y-o-y.

Chennai-based TVS Motor Company sold 253,974 two-wheelers in domestic market during September 2016, growing by 33.6% vis-à-vis 190,094 two-wheelers sold in September 2015. The company’s two-wheeler exports stood at 33,397 units in September 2016, up 8.1% y-o-y. The company stated that it had lost production of around 25,000 units in Sep’16 due to the disruptions in its supply chain operations.

Bajaj Auto too was in fast lane, witnessing sales of 230,502 two-wheelers in the domestic market in September 2016, which marked a hefty 22.8% increase over domestic sales volume of 187,711 two-wheelers in the same month last year. The two-wheeler exports, however, slumped 28.8% y-o-y to 101,474 units during the month.

India Yamaha Motor (IYM) recorded highest-ever monthly sales in the history of its operations in India, crossing one-lakh-unit-mark. With domestic sales tally of 89,423 units in September 2016, the company clocked a 32.9% growth y-o-y. The exports, on the other hand, de-grew by 24.9% y-o-y to 11,730 units during the month.

Unstoppable Royal Enfield clocked a growth of 30.2% in domestic sales that added up to 56,958 units in September 2016 as against 43,741 units a year ago.

M&HCV sales continue to head southward

With replacement demand petering out, M&HCV sales continued to face headwinds. Domestic M&HCV sales fell for the 3rd month in a row, by steep 20.6% y-o-y to 24,748 units in September 2016. However, LCVs built up on the growth momentum, with their domestic sales rising by 16.4% to 36,873 units in September 2016 from 31,671 units a year back.

Tata Motors’ overall commercial vehicle sales were in negative terrain. The company sold 26,610 CVs in the domestic market in September 2016, down 2.6% (September 2015: 27,325 units). Domestic sales of Tata M&HCVs plunged 20.0% y-o-y to12,726 units in September. However, Tata LCV sales continued their upward trend by notching up 21.7% growth, with domestic sales reading 13,884 units in September 2016, compared to 11,410 units in September 2015.

Likewise, second largest CV player, Ashok Leyland also posted a sharp 20.7% fall in domestic sales that aggregated 11,009 units in September 2016 vis-à-vis 13,890 in September last year. M&HCVs continued in deceleration mode, plummeting by 30.4% y-o-y to 7,989 units during the month.

Mahindra & Mahindra’s total commercial vehicles sales in domestic market were up 11.4% with sales of 16,081 units in September 2016 (September 2015: 14,430 units).

VE Commercial Vehicles maintained its double-digit growth. The company’s domestic sales of 4,148 units in September 2016 marked a 20.2% growth (September 2015: 3,452).

While OEMs have reported healthy growth in their passenger vehicle and two-wheeler sales in September, it is not reflected at the retail level. The auto market is counting on the pick-up in sales during October 2016 in which Navratris and other major festivals fall

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