Auto sales change gear, up 7%

Domestic passenger car sales witnessed a turnaround in November after four consecutive months of contraction, rising by 7% on the back of a marginal revival in demand, coupled with a low base. According to figures released by the Society of Indian Automobile Manufacturers (Siam) on Thursday, domestic passenger car sales stood at 171,131 units in November, as against 159,939 units in the same month last year.

“Domestic car sales have bounced back as the base in November last year was low. Also, we have seen some revival of demand in last month,” Siam senior director Sugato Sen said.

However, sales in December are likely to be lower than in November, he said. “The entry-level car segment, which is the biggest contributor to sales, has been hit most because of fuel hikes and rising interest rates. However, demand in the upper-end segment is comparatively doing well,” he said.

Car sales in India have been declining on a year-on-year basis since July, mainly due to the severe impact of labour issues on the country’s largest car-manufacturer Maruti Suzuki India’s (MSI) production.

Sales registered their steepest monthly decline in nearly 11 years in October this year, tanking by 23.77% on account of a huge drop in MSI’s output due to labour trouble, coupled with high interest rates and fuel prices. MSI’s domestic sales declined in November as well, dipping by 16.59% to 73,078 units from 87,618 units in the same month last year, Siam said.

However, the strong performance of other manufacturers made up for the slippage in MSI sales in November. Rival Hyundai Motor India posted a 10.72% growth in sales to 34,878 units in November, 2011, from 31,501 units in the same period last year. Tata Motors also reported a jump in sales to 23,540 units from 12,234 units in the same period last year, translating into a 92.41% increase.

As per the figures released by Siam, motorcycle sales in India grew by 22.67% in November to 869,070 units from 708,476 units in the corresponding month last year. Market leader Hero MotoCorp’s domestic sales increased by 27.02% to 485,381 units last month from 382,138 units in the same period last year.

In addition, Bajaj Auto saw a 18.24% rise in sales to 228,407 units from 193,174 units in the same period last year. However, TVS Motor Company posted a 10.45% fall in sales to 44,359 units last month from 49,534 units in the same month of 2010. Honda Motorcycle & Scooter India’s (HMSI) sales went up by 40.94% to 72,120 units during the month under review from 51,171 units in November, 2010.

Siam said total scooter sales stood at 229,309 units in November, 2011, as against 165,610 units in the same month last year, a 38.46% increase.

Market leader HMSI posted sales of 1,17,850 units, up 72.60% from 68,278 units in the year-ago period, while TVS Motor Co saw a growth of 16.08% in scooter sales to 41,132 units from 35,433 units in November, 2010.

In addition, Hero MotoCorp registered sales of 35,576 scooters, an increase of 30.95% from 27,168 units in the corresponding month last fiscal.

Total two-wheeler sales grew by 25.27% to 11,63,294 units last month from 9,28,660 units in November, 2010, as per the data.

Sales of commercial vehicles grew by 34.99% to 66,264 units during the month under review from 49,087 units in the year-ago period, Siam said. Light commercial vehicle sales rose by 48.01% during the month to 40,178 units from 27,145 units in November last year, it added.

Sales of medium and heavy commercial vehicles stood at 26,086 units in November, compared to 21,942 units in the same month last year, an 18.87% increase. Domestic three-wheeler sales grew by 5.85% to 42,875 units during the month under review from 40,504 units in November, 2010. Total sales of vehicles across categories registered an increase of 22.22% to 1,489,714 units in November from 1,218,885 units in the same month last year, Siam added.

Siam may lower FY12 car sales forecast

Despite better sales, the automobile industry is likely to see a downward revision of the passenger car sales growth forecast for 2011-12 for the third time this fiscal in January due to sluggish demand over the last few months. According to Siam, the passenger car segment may not even see single-digit growth in the current financial year. “During the Auto Expo next month, we are going to revise our sales projections for the fiscal... I feel the passenger car segment will again be downgraded,” Sen said. In October, Siam had significantly lowered its passenger car sales growth forecast for 2011-12 to 2-4%, the second revision after pegging it at 10-12% in July, as against its projection of 16-18% announced at the beginning of the current financial year. In the April-November period this financial year, domestic car sales declined by 3.53% to 12,19,509 units from 12,64,142 units in the year-ago period. “We may not see a decline in car sales for the entire financial year. The numbers may be just at the same level of last financial year,” Sen said. Talking about the passenger vehicle segment, Sen said, “It may see a growth of around 2%.” On total vehicles sales, Siam had revised its projection marginally upward to 11-14% for FY12 from 11-13% announced in July. It had revised its growth projection for the two-wheeler segment upward in October to 13-15% from 12-14%, while the estimate for commercial vehicle sales was increased to 13-15% from the earlier estimate of 12-14% in July.