Auto sales rise as festival season nears

The good run for automobiles continues unabated. Though last month also, overall industry growth was largely on account of the two big daddies of passenger cars and two-wheelers respectively - Maruti Suzuki India and Hero Honda Motors - even smaller players have begun to show healthy sales numbers.

Now, there is anxious wait for festive fervour to boost sales over the next two months. This year Navratras and Dussehra fall in September and Diwali in October so that vehicle dispatches from all manufacturers will remain exceptionally high for both these months.

And even if a majority of vehicle makers report robust sales growth during September-October, analysts would watch out for inventories and discounts which will emerge post Diwali to extinguish stocks with dealers.

But for the time being, no one is complaining. Certainly not Maruti, which is already gearing up for expansion of production capacity by at least a 100,000 units to meet anticipated double-digit demand this fiscal.

The company sold 84,808 cars during August, of which a record 14,847 were sold overseas. While domestic sales were helped by spurt in A2 segment (Alto, WagonR, Estilo, Swift, Ritz and A-Star) models at over 39% to 52,473 units, exports got a shot in the arm with Nissan Motor Co finalising a mega sourcing order for A-Star.

Maruti crossed the 50,000 unit export mark for April-August period and has already increased its annual export target from 1.2 lakh to between 1.3 lakh and 1.5 lakh units.

In the domestic market, SX4 and Dzire together grew 44% to 7,821 units (5,427 units). But sales of the M800 continued to decline at 2,734 units (3,717 units), combined sales of Omni and Versa remained virtually unchanged at 6,601 units (6,540 units) whereas those of Gypsy and Grand Vitara fell to half at 332 units (762 units).

Hyundai Motor India saw domestic sales outpace exports for the first time in many months this August. The company sold almost 13% more cars in the domestic market whereas export growth was only 8.7%. Total sales were 49,521 units (44,710 units).

Tata Motors also reported robust overall passenger vehicle growth after many months. The company sold 26% more vehicles at 20,146 units (17,364 Tata + 2,782 Fiat) in the domestic market; the growth for passenger cars alone was 21% at 14,755 units. It sold 2,501 Nanos, 9,598 Indicas and 2,656 units of the Indigo range.

On export front though, Tata Motors reported overall degrowth at 44% to 2,684 vehicles (4,772 vehicles).

Honda Siel Cars India continued to remain subdued, with a mere 4% sales growth at 4,102 units (3,945 units). It sold 1,029 units of Jazz and 2,536 of City. Mahindra & Mahindra reported 42% growth in total utility vehicle domestic sales (including the Xylo, Scorpio and Bolero) at 16,631 units (11,731 units).

However, Logan sales continued their decline with just 469 units last month against 1,464 units in August 2008. Even export sales continued to lag at 653 units (890 units) for M&M though exports of the Logan grew 10 times at 350 units against just 37 exported in the same month last year.

On the two-wheeler front, market leader Hero Honda continued outselling the market, dispatching more than four lakh vehicles last month for the first time ever. It sold 4,15,137 units which is a growth of 36% over 305,516 units it sold in August last year. And sister company Honda Motorcycle & Scooter India (HMSI) also reported robust growth at 14% by selling 96,149 units (84,476 units) during the month. India Yamaha Motor sold 19,508 units (11,974 units) registering 63% growth. Suzuki Motorcycle India reported 18% sales increase at 13,030 units (11,072 units).