Auto industry in FY 2013-14: A look back in numbers

The Society of Indian Automobile Manufacturers (SIAM) has announced production, domestic sales and exports figures for the year 2013-14. As expected, there is little good news with domestic sale of passenger vehicles (including cars, utility vehicles and vans) being 6 percent lower than the preceding year. Passenger car sales stood at 17,86,899 units (down 4.65 percent) while utility vehicles – a category that includes all SUVs – sales were down to 5,25,942 units (a 5.01 percent decline).

Breaking the numbers down further reveals a more detailed manufacture-wise picture.  Honda was the biggest gainer in the year with its sale of 1,34,339 units representing a staggering 82 percent improvement. As much as 97,205 units of that figure came from the Brio and Amaze. Fiat India also had a relatively good year with an 86 percent sales rise. Do note, the jump is relative to a small base and actual sales stood at only 11,980 units. Ford’s sales grew by 9.38 percent (to 84,469 units) with strong demand for the EcoSport more than making up for a sharp fall in Figo sales. Renault also managed to buck the trend of declining demand with its figure of 57,368 sales being a 9.35 increase. This year too, the Duster brought in the majority of buyers with sales of 46,786 units. Renault’s partner Nissan also managed to show a 3.28 percent improvement in sales.

Once again, Maruti led the sales charts with a total of 1,053,689 cars making it to Indian roads. That’s a marginal 0.25 percent improvement in sales. Hyundai too retained its position as India’s second largest carmaker with its sales of 3,80,253 units representing a 0.88 percent decline. Interestingly, the decline in Verna sales are nearly equal to the improvement in sales of Hyundai’s smaller cars such as the Grand i10.

General Motors did not have a great year with sales falling 8.24 percent to 80,890 units. The declining sales of Chevrolet’s hatchbacks (Beat and Sail U-VA) and in part, the Cruze sedan have hit the company hardest. Mahindra & Mahindra also didn’t have much to cheer over the year. Sales were down 18.14 percent to 254,344 units owing to a fall in demand for its popular utility vehicles. Volkswagen too had a disappointing year with sales reducing to 52,528 units (or a 19.77 percent decrease). Czech subsidiary Skoda fared worse with a sharp 31.33 percent fall in sales to 19,959 units. Toyota’s sales of 1,28,811 units also represented a decline of 22.17 percent while Tata’s fall down the charts continued with 36.78 percent fewer cars sold compared to the previous year.

If there was a bright spot, it was in the export of utility vehicles with a 298 percent improvement to 41,550 units. Much of this growth has come on account of the Ford EcoSport (17,496 units) and the Renault Duster (14,930).

Speaking at the announcement event, Vikram Kirloskar, president of SIAM and vice-chairman, Toyota Kirloskar Motors, attributed the fall in demand to subdued market sentiment and did not expect the situation to improve drastically in the months to come. Speaking on what SIAM was expecting from the next government at the Centre, he expected a reduction in taxes for the automobile industry and stability in the duty structure to help spur demand to some extent.

The lower sales have reduced the compounded annual growth rate of the passenger car market to 6 percent since 2010. While the number betters many other markets, the fact is the Indian market has not lived up to its potential of being the ‘next China’. What remains to be seen is how global manufacturers see these developments in terms of future investment.

Nikhil Bhatia