The prolonged slowdown in the passenger vehicle (PV) segment continued in June as almost all the major car manufacturers in the country, including Maruti Suzuki, Toyota, Tata Motors, Hyundai, Honda Motors, reported a decline in sales due to tepid demand. Only Mahindra & Mahindra (M&M) showed marginal growth.
Maruti Suzuki India sales fell 14% in June to 1,24,708 units over the year-ago period. Its domestic sales were down 15.3% at 1,14,861 units last month. The mini segment, comprising Alto and old WagonR, saw a slide of 36.2% to 18,733 units over the year-ago period.
Sales in the compact segment, which includes New WagonR, Celerio, Ignis, Swift, Baleno and Dzire, fell 12.1% to 62,897 units last month. In the mid segment, sedan Ciaz sales were up 47.1% at 2,322 units from 1,579 units in June last year. Sales of utility vehicles, including Gypsy, Ertiga, Vitara Brezza, S-Cross, were down to 17,797 units in June as compared to 19,321 units in the year-ago month, down 7.9 %.
Maruti Suzuki officials said the company has been continuously tightening on its production in order to keep the inventory at a reasonable level.
Sales in the Indian auto sector have been slowing for the last eight months, and according to the executives across original equipment manufacturers, retailers, component makers, one of the primary reasons for the slowdown in the industry has been a tightening of liquidity by non-banking financial companies, following the IL&FS crisis. The other prominent reasons include rise in fuel prices, rural distress due to lack of rains in certain regions of the country, new insurance laws leading to increase in its costs and a slowdown in certain industries, leading to dip in consumer sentiments.
Hyundai Motors India Ltd, the country’s second largest car maker, saw sales falling 7.3% to 42,007 units in June 2019. However, its exports rose 9% at to 16,800 units over the year-ago month.
The worst hit was Tata Motors, whose domestic passenger vehicle sales dropped 27% year on year to 13,351 units in June. According to Sibendra Barman – VP, sales, marketing and customer support, Passenger Vehicle Business Unit (PVBU), Tata Motors, the auto industry has been de-growing for the past four quarters and the customer sentiments remained low due to the overall slowdown in economic growth. “Consumer expectations on revised GST rate on cars and limited liquidity availability kept them from firming their buying decision this month. We expect to see a growth in demand in the coming few months and are well equipped to deliver the best to all.” Barman said.
Toyota Kirloskar Motor sold 10,603 units in the domestic market last month, a year-on-year decline of 19%. N Raja, deputy managing director, Toyota Kirloskar Motor, said the company has consciously lowered the volume of vehicles sold to dealers to ensure minimum burden on dealers amidst low buying sentiments.
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Maruti Suzuki officials said the company has been continuously tightening on its production in order to keep the inventory at a reasonable level.
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