The Hindu Business Line : Bumpy ride for auto companies in July

Mumbai, Aug. 1 It was mixed fortunes for automobile companies in July. Maruti Suzuki and Hyundai Motor India reported flat sales in the domestic market while Tata Motors and Mahindra & Mahindra showed a decline.

Two-wheelers manufacturers reported increased sales last month compared to July 2007.

In the domestic passenger car segment Maruti Suzuki sold 52,010 units (52,315 in July 2007) and Hyundai 15,066 units (15,003). Tata Motors’ passenger vehicles sales at 14,652 units dipped 14 per cent over July 2007.

Sales of Maruti’s base model M800 declined 17 per cent to 4,953 .

The compact car segment that includes Alto, WagonR, Zen Estilo and Swift clocked 34,795 units, 58 more than July 2007.

Maruti’s total sales including exports were 58,543, compared with 57,909 in July 2007.

Hyundai’s cumulative sales increased 28 per cent due to exports that are growing by 60 per cent thanks to the demand for i10. The cumulative sales of the Hyundai’s compact segment that includes Santro, i10 and Getz are 30,614.

“It has been a challenging month for the entire industry with the combined effects of increase in interest rates, hike in fuel prices and inflationary pressures affecting market sentiments,” said Mr Arvind Saxena, Senior Vice-President, Marketing, Hyundai Motor India.

“Overall the cumulative figures are positive for Hyundai but a host of negative factors have created a situation in the market where the industry is certainly going to face a slow down in demand should the situation continue for long,” he said.

Tata Motors attributed the downtrend to factors including restricted finance availability, price increase and product maturity in some segments. For Tata Motors, Indica reported 32 per cent drop at 7,525 units. The Indigo family recorded sales of 4,487 units, a 73 per cent growth over July 2007.

Mahindra Renault’s midsize sedan Logan’s sales dropped 51 per cent to 1,406 from 2,890 units in July 2007.

General Motors India’s sales grew 25 per cent on the back of its popular small car Chevrolet Spark, which clocked 3,570 units. Honda Siel Cars India sold 4,339 units (4,533).

In utility vehicle segment, market leader Mahindra reported drop in sales numbers. Mahindra sold 10,672 (11,567) UVs, an 8 per cent decline. The sales of the flagship model Scorpio fell by 35 per cent to 2,429 (3,749) .

Tata Motors recorded 21 per cent decline as the combined sales of Sumo and Safari fell to 2,640 units. The SUV sales were impacted by the increase in excise duties in the latter half of June 2008, said the company.

Two-wheelers

The two-wheeler manufacturers have reported higher sales for the fourth consecutive month, despite the high interest rate regime.

Market leader Hero Honda reported a 40 per cent growth at 281,317 units against 201,191 units in the corresponding month last year.

“We expect the growth to continue, particularly with the forthcoming festive season. However, managing high double digit growth in the post-festive season will be a challenge, and therefore, the second half of the fiscal is going to be crucial for the overall growth in the industry for the year,” said Mr Anil Dua, Senior Vice-President (Marketing & Sales), Hero Honda Motors Ltd.

The second largest two-wheeler manufacturer Bajaj showed 4 per cent increase in sales at 169,971 (162,801) . TVS Motor Company posted a 10 per cent growth at 116,000 units (105,366). TVS and Bajaj continue to show good export performance. Honda Scooters & Motorcycles India improved its sales figures from 74,534 to 85,501.

Motorcycles account for 27,793 units while the rest is scooters.

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