Despite huge discounts and a slew of new launches, the automotive industry is still going through one of the worst slowdowns in its history with passenger vehicles (PVs) — Maruti Suzuki India Ltd (MSIL), Honda Cars India Ltd (HCIL), Mahindra and Mahindra (M&M) and Tata Motors — registering a high double-digit decline in sales in the month of August.
India’s largest carmaker Maruti Suzuki reported a fall of more than 42 per cent in its domestic car sales to 65,993 units in August 2019 as against 114,261 units sold in the same month last year.
Its total domestic Passenger Vehicle sales (including UVs and Vans) fell 36.1 per cent — one of its sharpest dips in the last two decades to 93,173 units last month. This is the second consecutive month when the carmaker’s monthly sales fell below 1 lakh unit mark, reflecting sharp slowdown in the sector.
Moreover, the carmaker’s mini sub-segment, which includes Alto and Old WagonR models, is the worst hit with 72 per cent year-on-year decline at 10,123 units last month.
Wholesale volume in the compact car segment declined to 54,274 units in August from 71,364 units in the year-ago period, while mid-sized sedan Ciaz sales fell from more than 7,000 units in August 2018 to 1,596 units last month.
Maruti Suzuki India chairman RC Bhargava had praised the steps taken by the Centre to revive the sector and had asked state governments to promote manufacturing.
On August 23, Finance Minister Nirmala Sitharaman had announced a slew of measures such as registration of BS-IV vehicles beyond March 31, 2020, deferring of one time registration fees till June 2020, higher depreciation on all vehicles (doubling to 30 per cent from earlier), and more to lift sales.
Further, HCIL registered monthly domestic sales of 8,291 units in August 2019 as against 17,020 units in domestic market in August 2018, showing a slump of over 51 per cent.
“The sector continues to witness high de-growth due to poor consumer sentiments. This is despite the high discounts prevailing in the market which makes it the best time to buy cars. We hope measures taken by the government will help in improving consumer sentiments and demand creation. With the impending festive season, the sales are likely to pick-up...” said Rajesh Goel, senior VP and director, sales and marketing, HCIL.
Likewise, home-grown auto major M&M and Tata Motors also reported high double digit fall in sales in August. Mahindra reported a 26 per cent fall in its domestic sales to 33,564 units last month, while Tata reported a 49 per cent drop in sales to 29,140 units.
In PV segment, M&M sold 13,507 units last month compared to 19,758 vehicles in the same month last year, a drop of 32 per cent. Tata’s PV sales declined by 58 per cent to 7,316 units in August 2019 year-on-year.
Meanwhile, two-wheeler sales too registered a double digit decline in August. Bajaj Auto registered 15 per cent decline in its domestic motorcycle sales to 170,978 units.