Polls over, but motown still reeling under slow growth

Passenger vehicle sales continue to drop in June; Maruti, Hyundai, Tata Motors, Toyota witness decline.
Mahindra & Mahindra, however, reported a 4 per cent growth.

Major automobile manufacturers Maruti Suzuki, Hyundai, Tata Motors and Toyota Monday reported a decline in domestic passenger vehicle sales in June, continuing the prolonged slump in market due to poor consumer sentiments.

Mahindra & Mahindra, however, reported a 4 per cent growth in its domestic passenger vehicles (PV) sales last month.

Market leader Maruti Suzuki India (MSI) said its domestic sales during the month were down 15.3 per cent at 1,14,861 units last month compared to 1,35,662 units in June last year.

Mini segment, comprising Alto and old WagonR, saw a slide of 36.2 per cent to 18,733 units as against 29,381 per cent in the year-ago month.

The compact segment, which includes models such as New WagonR, Celerio, Ignis, Swift, Baleno and Dzire, clocked 62,897 units last month as compared to 71,570 units in the same month last year, down 12.1 per cent, it said.

Sales of utility vehicles, including Gypsy, Ertiga, Vitara Brezza, S-Cross, were at 17,797 units in June as compared to 19,321 units in the year-ago month, down 7.9 per cent, the company said.

Rival Hyundai Motor India Ltd (HMIL) reported domestic sales of 42,007 units last month as against 45,314 units in June 2018, down 7.3 per cent.

Homegrown utility vehicle major Mahindra & Mahindra's passenger vehicles sales were at 18,826 vehicles in June this year as compared to 18,137 vehicles in the same month last year, an increase of 4 per cent.

"The market sentiment continued to remain subdued, especially in the passenger vehicles segment.

“At Mahindra, we are happy to register a growth of 4 per cent in the segment and 8 per cent in the utility vehicles segment, on the back of our three recent product launches," M&M President (automotive sector) Rajan Wadhera said in a statement.

On the other hand, Tata Motors said its passenger vehicle sales in domestic market during the month dropped by 27 per cent at 13,351 units as compared to 18,213 units sold in June 2018 due to low customer sentiments due to liquidity crunch.

"Industry continued to remain stressed. However, the market is expected to bounce back soon," it added.

Toyota Kirloskar Motor (TKM) also reported 19 per cent decline in domestic sales at 10,603 units last month as compared to 13,088 units in June 2018.

Commenting on the sales performance, Toyota Kirloskar Motor deputy managing director N Raja, said, "The industry has been witnessing a continuous decline in domestic sales owing to several factors that have contributed to the weak consumer sentiment."

The prevailing economic uncertainty, uncertainty on monsoon, high interest costs, tight liquidity and also the underlying apprehensions surrounding BS-VI introduction in few months have steered the slowdown, he added.

Last month, passenger vehicle wholesales in India witnessed the steepest decline in nearly 18 years, dropping by over 20 per cent in May, as continued weakness in retail offtake forced manufacturers to cut production in order to adjust to market demand.

Barring October last year, when sales were up 1.55 per cent, up until May PV offtake has been in the negative in the ten months off the last 11 months.

In two-wheeler segment, Bajaj Auto posted 1 per cent decline in domestic motorcycle sales at 199,340 units in June as against 2,00,949 units in the same month a year ago.

Chennai-based TVS Motor Co said its domestic two-wheeler sales stood at 226,279 units last month as compared to 2,46,176 units in June 2018, a decline of 8 per cent.

In contrast, Suzuki Motorcycle India Pvt Ltd (SMIPL) registered domestic sales of at 57,023 units in June as against 46,717 units in the year-ago month, a growth of 22 per cent.

Photograph: Danish Ismail/Reuters