India’s automobile companies continued to report contracting demand, with sales data for February indicating that there has been little improvement in offtake. A few automobile manufacturers have also highlighted possible supply constraints arising from the coronavirus outbreak, which could affect production in the near future.
For February, Mahindra & Mahindra reported a steep 42 per cent fall in total sales year-on-year, at 32,476 units compared to 56,005 last year.
Domestic market sales were down 42 per cent at 30,637 units compared to 52,915 in February 2019 and exports dived 40 per cent. In the passenger vehicles segment, including utility vehicles, cars and vans, M&M reported a decline of 58 per cent while commercial vehicle sales fell 25 per cent.
As for Tata Motors, domestic sales fell 34 per cent in domestic sales at 38,002 units against 57,221 units last year, while Hyundai Motor reported 7.2 per cent decline in domestic sales and 22 per cent fall in exports.
The country’s largest carmaker Maruti Suzuki India (MSIL) also reported a decline in total sales, but at a marginal 1.1 per cent compared to the previous year. Domestic sales dropped 1.6 per cent to 1,36,849 units last month but, exports were up 7.1 per cent year-on-year.
Coronavirus may hit parts supply
Auto majors also highlighted possible risks to their supply chains due to the coronavirus outbreak. Mayank Pareek, president (PV Business Unit), Tata Motors, said that the outbreak and a recent fire incident at one of its strategic vendors had affected vehicle production and wholesale volumes. “Actions are being taken to reduce the impact, staying close to our customers by providing transparency of the delivery situation,” he said. M&M chief of sales and marketing Veejay Ram Nakra said that because of the “unforeseeable challenges on the parts-supply from China, BS-VI ramp-up has been affected”. “Going into March, we anticipate the challenge on parts-supply to continue for another few weeks, before we get back to normalcy,” he said.
M&M reported a 42 per cent fall in sales YoY, while Tata Motors saw domestic sales drop by 34 per cent. Hyundai reported 7.2 per cent decline in sales, while Maruti Suzuki’s sales fell 1.1 per cent