Auto Sales Remain Positive Aided by Economic Upturn

Auto sales during the month of May 2018 clocked double-digit growth, propelled with economic growth as real GDP growth spurted to an eight-quarter high of 7.7% in Q4. This growth was due to both consumption and investment showing improvement.  

The total number of vehicles sold in the domestic market during May 2018 aggregated 2,282,618 units representing a growth of 12.13% over the same month last year despite petrol and diesel prices increasing daily.  This significant uptick in domestic sales numbers was contributed by all segments of industry.  Commercial vehicles and three-wheelers led the charge with robust growth of 43.06% and 51.97%, respectively.   Passenger vehicles witnessed positive growth of 19.65% y-o-y in domestic market, albeit on the back of discounts offered on the old models and variants. Preference in passenger cars was also noticed in the purchase of petrol variants as price differential narrowed between petrol and diesel. Two-Wheelers also grew by healthy 9.19% during the month.

The country’s largest carmaker, Maruti Suzuki India (MSIL) having 50% market share, reported a 24.9% jump in sales to 170,340 units (including exports) during the month of May 2018, the company’s domestic sales growing by 24%.  The major contribution to the company’s growth numbers came from Swift, Celerio, Ignis, Baleno, Dzire, Tour S in the Compact segment which vaulted by 50.8% to 77,263 units during the month. The domestic sales volume in Mini segment comprising of Alto and Wagon R slided by 3.1% to 37,864 units in May.  Also, sales of Mid-Size segment comprising of Ciaz slipped further by 14.8% to 4,024 units from 4,724 units a year ago.

Maruti’s exports remained bullish and surged 43.2% to 8,843 units in May 2018.  

Hyundai Motor India Ltd (HMIL) – India’s second largest car manufacturer and the largest passenger car exporter, clocked a domestic sale growth of 7.1% y-o-y. The cumulative sales increased by 11.4%, while the exports growth was an impressive 33.3% as compared to May last year. 

HMIL’s total sales for May 2018 stood at 56,016 units as against 50,264 units in May, 2018. Of this, the domestic sales accounted for 45,008 units (42,007 units) and the overseas sales grew to 11,008 units from 8,257 units in May 2017. The tremendous response for the New 2018 CRETA and the New 2018 ELITE i20 showcases the customers increasing preference for high value in style and first in segment features.

Commenting on the sales Rakesh Srivastava, Director - Sales and Marketing, HMIL said, “Hyundai with a volume of 45,008 units had a growth of 7%, maintaining strong momentum with Power Brands - CRETA, ELITE i20, Grand i10 and The Next Gen VERNA showcasing our strong performance month on month and year on year with a strong promise of growth.”

Honda Cars India (HCIL) recorded 40.66% increase in its domestic sales for the month of May 2018 with a tally of 15,864 units as against 11,278 units sold in May 2017.  This growth was led by All New Honda Amaze clocking monthly sales of 9,789 units, which is highest ever monthly sales numbers for a single Honda model.

The company notched up export sales of 516 units compared with 498 units in the corresponding period last year, which translated into a growth of 3.6%.

Rajesh Goel, Senior Vice President and Director, Sales and Marketing, Honda Cars India said, “We are delighted with the customer response to the All New Amaze which has helped our overall sales grow by 41% in May 2018. The customers have appreciated the car for its one class above offering of unmatched bold design, sophisticated & spacious interiors, advanced engine technology and outstanding driving dynamics.”

Ford India’s combined domestic wholesales and exports in May 2018 recorded 26,188 vehicles from 23,413 vehicles in the same month last year, a growth of 11.9%.

The company’s domestic wholesales stood at 9,069 vehicles in May 2018, up from 6,742 vehicles in the same month last year. Exports during the month grew to 17,119 vehicles from 16,671 vehicles in May 2017.

Commenting on Ford's sales, Anurag Mehrotra, President and MD, Ford India said, "Our continued focus on executing our strategic pillars of strong brand, right products, competitive cost and effective scale have ensured our growth which continues to be better than the industry. At macroeconomic level, the outlook is positive thanks to a good monsoon forecast. However, the industry needs to exercise caution given the rising commodity and fuel prices that are expected to result in higher inflation."

Toyota Kirloskar Motor (TKM) sold a total of 13,113 units in the domestic market during the month of May 2018 growing by 20.1%. The company exported 855 units of the Etios series in May 2018 thus clocking a total sale of 13,968 units. TKM sold a total of 10,914 units in the domestic market and exported 1442 units of the Etios series in May 2017.

Passenger Vehicle Business Unit of Tata Motors reported a total sale of 19,202 units in domestic market during May 2018, an impressive 53.6% increase compared to 12,499 units sold a year ago. The Tata cars recorded a growth of 17.6% at 11,516 units driven by continuous strong demand for Tiago and Tigor, while the UVs continued to record an exceptional performance of 463% growth at 5,973 units, due to the strong demand for the Nexon and Hexa. Tata Vans also reported a modest growth of 4.2% clocking sale of 1,713 units.

Tata Motors’ exports at 126 vehicles in May 2018 were up 41.6% from 89 vehicles exported in May 2018. 

Mahindra & Mahindra (M&M) clocked a marginal growth of 1.6% y-o-y in its domestic sales of passenger vehicles (which includes Cars, UVs and Vans) during the month of May 2018 at 20,621 units (20,290 units). The company exported 1,242 PVs during the month growing by whopping 303.2% YOY. 

Both, Renault India and Nissan India were in negative terrain in the Indian market, selling 6,732 units and 3,569 units respectively during the month. However, in the international market the companies performed well achieving growth of 46.3% and 18.3% respectively. 

Commercial Vehicles a barometer of economic activity continued to head north on back of infrastructure projects in full swing across the country.

Mahindra & Mahindra in the commercial vehicle segment, sold 18,748 vehicles in May 2018, registering a 15.3% growth. In the Medium and Heavy Commercial Vehicles segment, M&M sold 1,321 vehicles and in Light Commercial vehicle segment, the company sold 17, 427 vehicles during the month in domestic market. Exports of CVs for May 2018 stood at 1,707 vehicles, with a high growth of 100.6%.

Commenting on the monthly performance, Rajan Wadhera, President, Automotive Sector, M&M Ltd, said, “May has relatively been a subdued month compared to April. At Mahindra we have by and large maintained our growth momentum during the month of May 2018, especially in commercial vehicles. On the back of a buoyant economy, our MHCV division continues to outperform. Exports have also been strong with a high growth. With the forecast of an upcoming normal monsoon we are confident of good growth in the coming months.”

Tata Motors’ total sales (including exports) of commercial in May 2018 added up to 38,666 vehicles, a growth of 50% over 25,773 vehicles sold in May 2017. Domestic sales volume of Tata commercial for May 2018 stood at 35,093 units, a 59.8% growth over 21,962 units sold in May last year. 

Tata Motors sold 15,810 M&H commercial vehicles in May 2018 in the domestic market - up 89.1% over the previous corresponding sales tally of 8,361 M&H CVs. LCV sales were 19,283 units, rising by 41.8% over the corresponding sales figure for May last year. 

Ashok Leyland sold 12,077 CVs in the domestic market during the month against 7,833 vehicles sold in the same month last year, a growth of 54.2%. The company also exported 1, 582 vehicles during the month clocking 27.4% uptick YOY. 

VE Commercial Vehicles sales at 5,371 units in the domestic market notched a decent growth of 34.7% against 3, 987 units sold in May 2017. 

Two-wheeler sales remained on fast track during the month.  

Hero Motocorp once again came up with a healthy growth of 13%, clocking domestic sales of 692,601 two-wheelers during May 2018 compared to corresponding sales figure of 613,019 two-wheelers a year ago. 

Honda Motorcycle & Scooter India (HMSI) continued to move up the sales curve with its steady performance.  HMSI’s domestic sales numbers at 519,087 units in May 2018 surged by 1.7% y-o-y.  The company also turned in creditworthy performance on export front, its exports at 32,529 units growing by 22% and resulting in a 2.7% rise in its cumulative sales during the month.

TVS Motor Company posted a 8.2% growth in May 2018, witnessing total two wheeler sales of 298,135 units vis-a-vis 275,426 units in the same month last year. Domestic sales of TVS reading 246,231 units in May 2018 climbed up 2.4% from 240,527 units a year back.

TVS Scooters continued to grow, recording 8.9% growth in sales at 90,737 units (83,338 units). Domestic motorcycle sales were in the negative terrain and stood at 82,427 units in May 2018 as against 86,936 units recorded in May 2017. Company sold 73,067 Mopeds in the domestic market accruing 4% growth YoY. Exports of 51,904 two-wheelers were robust at 48.7% against export of 34,899 units in the corresponding month of the previous year.

India’s second largest two-wheeler manufacturer – Bajaj Auto continued to be on growth trajectory selling 192,543 two-wheelers in the domestic market during the month gaining by 23% y-o-y.  The company’s exports also grew by 24.4% to 23.6% in its cumulative sales of two-wheelers in May 2018.

Royal Enfield and Suzuki Motorcycle also saw robust growth of 23.6% and 36.6%, respectively, in their domestic sales of two-wheelers during the month.

With economy and especially industrial production picking up, outlook for the coming months looks promising. Equally encouraging is the forecast of an upcoming normal monsoon. All this augurs well for sustained momentum in automobile market in the coming months  

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