Tractor, two-wheeler sales recover in June

MARUTI SUZUKI SAW A 53.8% Y-O-Y DECLINE IN SALES TO 51,274 UNITS IN JUNE COMPARED TO 13,865 UNITS IN MAY

MUMBAI:India’s top automakers posted sharply higher sequential increase in wholesales, or factory dispatches, in June as they ramped up production though it remained a far cry from the pre-Covid-19 levels.

Sales at Maruti Suzuki India Ltd and Hyundai Motor India Ltd, the country’s top two carmakers, were nearly half of their year-ago volumes. Tractor and two-wheelers, however, saw a sharp recovery thanks to rural demand.

Maruti Suzuki, the country’s top carmaker reported a 53.8% year-on-year (y-o-y) decline in local passenger vehicle sales to 51,274 units. June sales was a sharp improvement from May when the company sold 13,865 vehicles. Maruti had reopened its plants in a staggered manner in May. Sales of hatchbacks, which make up bulk of Maruti’s sales, fell 55% y-o-y at 37,154 units. The company anticipates demand to return for its entrylevel small cars—first in rural and semi-urban markets, followed by urban markets where office commuters would look for their own vehicle over using public transportation. Osamu Suzuki, chairman, Suzuki Motor Corporation, had in a recent letter to Maruti’s vendor partners asked them to support the company’s plan of producing 100,000 or more vehicles per month from July.

Puneet Gupta, associate director at IHS Markit said demand recovery in India has been poor relative to other markets due to the strict lockdown.

“However, demand has outstripped production in June. While safety norms in the factories continue to be stringent, fear among contractual workers remains high,” he said, adding contract workers would be needed to achieve over 80% capacity utilisation.