May Auto Sales Live: Bajaj Auto Sales Fall 30%

Two-wheeler maker, Bajaj Auto Ltd sold a total of 2,71,862 units in May, led by surge in exports the company said in an exchange filing on Tuesday. Bajaj Auto's sales fell 30% over last month. Year-on-Year, the sales are not comparable due to lockdown last year.

Sales snapshot (M-o-M)

• Total domestic sales fell 51% over last month to 60,830 units in May.
• Total exports too fell 4,7% to 2,11,032 units in May.
• Total commercial vehicle sales fell 21.4% to 31,308 units in May.

Escorts Ltd.’s agri machinery segment sold 6,423 tractors in May, the company said in a statement to the exchanges on Tuesday.

The automaker's tractor sales declined 7.9% over the last month. Year-on-year, the sales are not comparable due to lockdown last year.

In domestic market it sold 6,158 units, while in exports it sold 265 units.

Slowdown in demand is seen due to impact of COVID-19 in the rural parts impairing movement of customers and smooth operations of our dealerships, the company said in the statement.

"The ground situation has somewhat eased in the last few days of the month, and we expect return to normalcy soon."

In the medium term, escorts see rural sentiment to be strong, on account of all positive macroeconomic factors viz. prediction of a good monsoon, high crop production and better support by Government on crop prices.

"Inflation continues unabated and remains a worry."

The severe second Covid-19 wave brought back pain for India’s automakers as their sales are seen to slump over the preceding month on fresh lockdowns in several states and companies suspending manufacturing.

Factory-gate shipments of passenger cars, two-wheelers and commercial vehicles is expected to tumble in the range of 14-73% month-on-month in May, according to data compiled from the reports of three brokerages — Dolat Capital, Emkay Global, and Motilal Oswal.

Shipment of automobiles over the year earlier is not comparable because of a low base caused by a nationwide lockdown to contain the first wave of the pandemic.

“States with complete lockdowns represent 50-60% of volumes across segments. In addition, there are partial lockdowns in the remaining states,” analysts at Emkay Global said in a report.

The mounting infections had also prompted automakers such as Maruti Suzuki India Ltd., Hero MotoCorp Ltd., Escorts Ltd. and Eicher Motors Ltd. to shut down plants in a staggered manner to mitigate the high inventory levels at dealerships, lowering production.

• Among the segments, two-wheelers are expected to be hit the hardest. According to Dolat Capital, retail sales of two-wheelers are likely to decline 50-60% month-on-month in May.
• Commercial vehicles, too, would face pressure because of lower freight availability, and as truck movements were hit across the country amid the second wave.
• Volumes of tractors, which recovered ahead of other segments from the Covid-19 disruptions during the first wave on account of improved rural sentiment, are likely to fall by more than 30-35% over the preceding month in May.
• Passenger vehicle segment, however, will be the least impacted because of a healthy order book and low inventory level amid supply-chain constraints.

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