With festive season around the corner, domestic sales of passenger vehicles- cars, utility vehicles and vans- surged by 14 per cent in August as dealers built inventory. The industry is estimated to have sold almost 290,000 vehicles last month with double digit growth from market leader Maruti Suzuki besides Honda and Tata Motors. Hyundai, the second biggest player grew at nine per cent. July sales had grown 15 per cent.
Maruti, which now commands a 50 per cent share in domestic market, sold 151,270 units to dealers last month as against 119,906 units in August last month. Sales of compact segment vehicles (Swift, Baleno, etc) rose 62.4 per cent to 74,012 units while utility vehicle (Brezza, Ertiga, etc) clocked growth of 27.6 per cent. The mini (Alto, WagonR) segment, however, remained flat at 35,428 vehicles. The company's stock price gained 1.43 per cent to close at Rs 7,812 at the BSE on Friday.
Korean car maker Hyundai said its sales grew nine per cent in August to 47,103 vehicles. Rakesh Srivastava, director (sales and marketing), Hyundai said the company managed to grow sales in a 'market fuelled with speculations' on the GST cess increase and challenges posed by floods in many states. "We foresee strong buying in festive period due to spread of monsoon and our product portfolio," he said. Navratri, an auspicious occasion for purchases of consumer durables, cars and real estate begins on September 21 and ends on 29th of the same month.
SUV major M&M, the third biggest car player, has reported sales growth of six per cent in August. "Our brands continue to gain traction despite several external challenges. As we get into festive season, we are confident of a good growth over the next couple of months," said Rajan Wadhera, President (Automotive Sector) at M&M. Another homegrown auto major Tata Motors has seen a ten per cent jump in August sales to 14,340 units. "With Ganesh Chaturthi, we have entered the festive season and we expect the growth momentum to continue," said Mayank Pareek, President of the passenger vehicles unit at Tata Motors. He attributed the growth to new products like Hexa, Tigor and Tiago. The company's stock gained 3.74 per cent to close at Rs 390.70 on Friday.
Japanese car maker Honda saw a 24 per cent increase in sales to 17,365 units. Its Japanese peer Toyota has reported a six per cent drop in August volume to 12,017 vehicles. N Raja, director & senior vice president (Sales & Marketing) at Toyota said the sales numbers of August are not truly reflective of the existing customer orders. "Post the announcement on potential cess hike, there was a considerable rise in customer enquiries and orders. We had production limitations which held us back from catching up with the high demand," he said.
Volumes at French car maker Renault continue to decline and is learnt to have seen its sales shrink by 26 per cent in August. Players like Ford, Nissan and Volkwagen also saw a dip in sales. Launch of the Jeep Compass helped FCA to expand sales substantially from 651 units in August last year to 2,258 units this August.
Amit Kaushik, managing director for Detroit-based automobile consultancy Urban Science in India said factors like festive season, harvest of kharif crop and new product launches will continue to aid demand for cars. "Issues like cess do not impact the mass car market and therefore we expect the pace to continue," he said.