Passenger vehicles post mixed sales in September

India’s passenger vehicle sales in September witnessed a mixed trend when compared to the same month last year. While carmakers such as Maruti Suzuki, Hyundai, Honda and Ford posted a growth in sales on the back of new products launched in the recent months, Mahindra & Mahindra (M&M), Toyota as well as Tata Motors saw a decline. Hyundai posted its highest-ever sales in a single month in the last 17 years.

Going ahead, however, demand is expected to gather pace amid the festive season. Moreover, the recent cut in interest rate by various banks is also likely to enhance consumer sentiment. Auto loans are now cheaper after Reserve Bank slashed its key interest rate by 0.50 percent resulting in major banks in the country also cutting their base lending rates.

India’s largest carmaker Maruti Suzuki posted a 6.8 percent year-on-year rise in domestic sales to 1,06,083 units in September. Sales of the company’s compact car models such as the Swift hatch, Dzire sedan, Ritz and the Celerio recovered from an 11.3 percent decline in August to a growth of 3.5 percent year-on-year to 44,826 units in September. However, sales of its entry-level segment cars such as the Alto and Wagon R were steady at 35,570 units. 

Hyundai recorded highest-ever domestic sales of 42,505 units in September, up 21.3 percent from the 35,041 units sold during the same month last year, due to the strong demand for its Creta SUV as well as the i20 hatchback.  The carmaker is said to have increased production from the planned 5,000 units to almost 7,500 units a month in an effort to meet the rising demand for the SUV.

While Mahindra reclaimed the third position from Honda after a span of three months, its passenger vehicle sales continued to decline despite the launch of its TUV300 SUV almost a month ago. Mahindra registered a 7 percent drop in passenger car sales to 19,564 units last month. The carmaker was banking on the sales of its TUV300, in order to revive sales that have witnessed a slowdown in the past few quarters as well as regain its market share in the utility vehicle segment.

Mahindra is optimistic about the interest rate cut on car loans as well as the upcoming festive season propping up its sales in the near term. Pravin Shah, president and chief executive (Automotive), M&M Ltd. said, “While the automobile industry has witnessed a slow and fragmented recovery, the recent interest rate reduction is bound to infuse optimism. If the majority of the rate cut is passed on to customers by the lending institutions, it will bring back the momentum in auto sales especially during the upcoming festival season.”

Japanese carmaker Honda registered a growth of 23 percent with monthly domestic sales of 18,509 units in September 2015 against 15,015 units in the corresponding month last year. The carmaker’s bestseller for the month was its Amaze sedan, which sold 6,577 units, up more than 70 percent from last year. The Jazz sold 4,762 units while the City found 5,702 buyers.

Sales of Toyota declined 9 percent to 11,401 units last month, as against the 12,542 units from last year. Similarly, Tata Motors also saw its passenger vehicle sales decline marginally to 11,774 units as against 11,931 units in September last year. Although sales of its cars grew by 5 percent, to 10,226 units, a decline of 28 percent in sales of its utility vehicles at 1,548 weighed on the overall passenger vehicle sales.

Ford India registered sales of 8,274 units in September, up 22 percent from 6,786 units sold last year on the back of the recent launch of the Figo Aspire. Moreover, the carmaker also confirmed new investment dedicated towards expanding operations and the establishment of a technology center at the Ford Chennai Plant