AUTO SALES DOWN 24%
Passenger vehicle sales slumped 23.7% year-on-year in September, the eleventh straight month of such decline.
Wholesale despatches of passenger vehicles (PVs) slumped 23.7% year-on-year in September, the eleventh straight month of such decline, reflecting the slowdown in the wider economy and an overestimation of pre-festival sales by automakers.
Despatches fell to 223,317 units from 292,660 in September 2018, as the economy grappled with the impact of a protracted slowdown that started with the Infrastructure Leasing and Financial Services (IL&FS) bankruptcy last year.
Indicating subdued demand in both the rural and semi-urban markets, despatches of motorcycles during the month witnessed the sharpest ever decline since 1997-98.
Despatches of passenger cars fell a massive 33.4% to 131,281 units during the month, but utility vehicles bucked the trend and rose 5.5% year-on-year to 816,25 units, helped by new launches, according to data released by the Society of Indian Automobile Manufacturers (Siam) on Friday.
The decline in despatches just before the festive month of September and October indicates subdued expectations of automobile manufacturers from the festive season in October. Usually, festival season sales make up almost a third of total sales during a fiscal year and manufacturers traditionally increase despatches expecting robust sales.
Automakers in India report wholesales and not retail sales data on a monthly basis. In the last one year while wholesales of vehicles have been on a doubledigit decline, retail sales are expected to have declined in the range of 8-9%, reflecting an over
DESPATCHES OF MOTORCYCLES DURING THE MONTH WITNESSED THE SHARPEST EVER DECLINE SINCE 1997-98
estimation by manufacturers.
Automakers in the first half of the last fiscal filled their dealers with stocks despite falling showroom sales in the aftermath of IL&FS bankruptcy. As a result, this year manufacturers held back on despatches to clear existing stocks.
The commercially important festival season started with Onam in September and will continue till Diwali on October 27.
Across categories, vehicle sales in September fell a significant 22.4% year-on-year to 2,004,932 units, due to a slowdown in the economy, floods in some states and lack of credit availability from financial institutions. Sales across segments saw high double-digit decline, barring those of three-wheelers, which declined by a modest 3.92%.
Earlier in September, Maruti Suzuki India Ltd, the country’s largest passenger vehicle manufacturer, witnessed a 26.7% yearon-year (y-o-y) drop in despatches to 112,500 units, while Hyundai Motor India Ltd reported a 14.8% fall to 40,705 units, despite a healthy response for its first compact SUV, the Venue, launched in May.
On a sequential basis, though, sales have picked up from September when wholesales dipped to an all time low. In July and August, Maruti Suzuki’s factory despatches fell below the 100,000unit mark as the company cut production and despatches. In September, it dispatched 112,500 units to dealers. Hyundai also touched the 40,000-unit mark in September after slipping to 38,205 units in August. This trend is visible in the wholesales of most of four- and two-wheeler manufacturers.