Free Press Journal

Lower interest and fuel costs, accelerates August auto sales 


New Delhi/Chennai: A decline in interest, inflation and fuel costs, coupled with an overall pick up in consumer sentiment, saw Indian automobile manufacturers come out with healthy sales figures for the last month on Tuesday.

“With low inflation, softening in oil prices and new launches, the trend of growth in the automotive industry continues in August 2015,” said Abdul Majeed, automobile expert and partner with Price Waterhouse.

“The only downsize risk would be adverse impact of monsoon in the rural economy, the impact of which will be known in the coming few months.”

However, the Indian equities markets were disappointed with slowdown in the growth of domestic auto companies.

“Apart from global cues, Indian equities were buffeted by lower than expected GDP data and disappointing sales numbers of Maruti and M&M,” said Sanjeev Zarbade, vice president, private client group research with Kotak Securities.

The S&P BSE (Bombay Stock Exchange) automobile index receded by 472.84 points in the day’s trade.

Company-wise, Maruti Suzuki’s August sales grew by 6.4 percent to 117,864 units from an off-take of 110,776 units in the corresponding month of 2014.

The company’s domestic sales rose by 8.6 percent at 106,781 units. However, exports plunged by 11.1 percent to 11,083 units.

Chennai-based Hyundai Motor India’s sales rose by 13.5 percent to 54,608 units – up from 48,111 in the corresponding month of 2014.

“The company looks forward to sustain double digit growth above industry growth rate increasing market share in passenger vehicles,” said Rakesh Srivastava, senior vice-president (sales and marketing) of HMIL.

The domestic sales last month rose by 20 percent to 40,505 units. However, the largest passenger car exporter only managed to ship out 14,103 units in August, which is a decline of 1.8 percent.

Home grown automobile giant Tata Motors’ closed last month with a marginal decline in overall sales. It closed August at 40,680 units against 40,883 vehicles sold during the same month in 2014.

Domestic sales registered a decline of three percent at 35,478 units, whereas exports jumped by 16 percent and stood at 5,202 units.

Other domestic vehicle manufacturer Mahindra & Mahindra (M&M) closed last month with sales coming up by 1 percent as compared to August 2014.The company’s total sales in the month under review stood at 35,634 units as against 35,180 units during August 2014.

M&M’s domestic sales were down 3 percent at 32,122 units last month. Exports, on the other hand zoomed by 3,512 units being shipped out from 2,030 units sold abroad.

“While currently we are witnessing fragmented recovery in auto sales, we are hopeful that the upcoming festive season will provide a much needed fillip to the auto industry,” Pravin Shan, president and chief executive (automotive), M&M was quoted as saying in the statement.

Indo-Japanese joint venture (JV) Toyota Kirloskar Motor (TKM) reported a 1 percent rise in its sales for the last month which stood at 12,547 units.

Other foreign car manufacturers came out with healthy sales figures for August. European car manufacturer Volkswagen’s sales rose by 17 percent to 4,191 units. Ford India’s overall sales surged by 53 percent to 21,520 vehicles.

In the two-wheeler segment, Hero MotoCorp’s sales last month dropped by 13.97 percent to 480,537 units from 558,609 units sold in the corresponding month of last year.

Suzuki Motorcycle registered a 67.58 percent increase in their August 2015 sales at 36,636 units from 21,862 units sold in the same month last year.

Honda Motorcycle and Scooter India reported a 2 percent growth in sales during the last month. The company sold a total of 395,262 units from an off-take of 388,016 units during August, 2014.

Two and three-wheeler maker TVS Motor closed last month with 1 percent growth in sales volumes at 227,653 units as against 225,064 units sold in August 2014.

Royal Enfield’s, the two-wheeler arm of Eicher Motors’ total sales grew by 59 percent in August at 42,360 units sold over the corresponding period last year when it had an off-take of 26,643 units.