January Auto Sales Live: Maruti Suzuki’s Passenger Car Sales Drop

Escorts Ltd. sold 5,991 tractors in January, an increase of 12.7 percent from the year-ago period, according to its stock exchange filing.

Key Sales Highlights:

Domestic sales rose 11.7 percent year-on-year to 5,762 units.

Exports rose 46.8 percent to 229 units.

Maruti Suzuki India Ltd. reported muted sales growth in January, hurt by weak demand for its passenger cars and lower exports.

India’s largest passenger car maker sold 1.52 lakh units, as compared with 1.51 lakh in the year-ago period. "This includes 1.42 lakh units in the domestic market and 9,571 units of exports," the company said in a notification to the exchanges.

Passenger car sales, however, declined 4.1 percent to 1.02 lakh units, hurt by tepid demand for its compact and mid-sized cars such as Swift, Dzire, Baleno and Ciaz. That compares with 1.06 lakh units sold in the same month last year.

Sales in utility vehicles and vans grew considerably by 8.4 percent and 23.6 percent to 22,430 units and 15,145 units, respectively.

While the domestic sales improved marginally to 1.42 lakh units on a yearly basis, the exports steeply declined by 11 percent to 9,571 units.

Auto sales are expected to remain tepid in January due to muted demand and weak consumer sentiment, according to BloombergQuint poll of three brokerages.

Sales of two-wheelers and commercial vehicles are likely to hit a speed bump, the poll showed, indicating higher inventory levels at dealerships have led to slower wholesales volumes, adding to the woes of auto companies.

While there has been a notable decline in inventories especially in passenger vehicles, the two-wheeler segment inventory remains high, said Deep Shah, research analyst at Motilal Oswal said.

Nomura expects passenger vehicle sales in January to decline by 5 percent on a year-on-year basis. The Japanese brokerage firm expects a 4 percent decline in two-wheeler sales and a 7 percent drop in medium and heavy commercial vehicle sales for the same period.

New launches like Wagon R, Tata Harrier and Nissan Kicks in January can benefit wholesales, said Nomura’s auto analyst Kapil Singh, adding that a weaker demand in the medium and heavy commercial vehicle segment should lead to volume decline sustaining.

The tractor demand, according to a Motilal Oswal note on Jan. 29, has been weakening in key agriculture states of Maharashtra, Madhya Pradesh and Rajasthan.