Industry experts attributed a big part of the increases to depleted inventories with dealers and also a low base. They cautioned that retail sales would not be as good. More details here.
Ahead of the festive season, wholesale despatches of cars, commercial vehicles (CVs) and two-wheelers’ automakers gained momentum in September. Industry experts attributed a big part of the increases to depleted inventories with dealers and also a low base. They cautioned that retail sales would not be as good. “Stocks with dealers have dropped to below the required levels,” an industry insider explained. He pointed out that due to the inauspicious period — shraadh and adhikmaas — retail sales in September have been somewhat subdued. Nonetheless, auto majors remain optimistic the pent-up demand will result in a good festive season. In a sign of a pick-up in economic activity, Ashok Leyland dispatched 7,847 vehicles in September, a 35% jump over the August numbers, though flat year-on-year. With despatches of 1,50,040 vehicles, up 33.4% y-o-y and 30% month-on-month, Maruti Suzuki clocked its historical monthly average for the first time in nine months.
Hyundai Motor India reported domestic despatches of 50,313, up nearly 10% m-o-m and a sharp 23.6% y-o-y. Director Tarun Garg said he was confident the coming festive season would drive the market to a steady recovery path. Both HeroMotoCorp and Bajaj Auto fared well and TVS Motors didn’t do badly either. In fact, starting October Hero has increased ex-showroom prices of its motorcycles and scooters by up to 2% to partially offset the rising input costs and commodity prices, the company said. Bajaj Auto reported a 6% y-o-y increase in despatches of two-wheelers for the home market but at TVS, they were flat y-o-y.
Mahindra and Mahindra (M&M) clocked domestic sales of 34,351 units, an improvement of over 17% m-o-m but a fall of 16% y-o-y. Veejay Nakra, CEO (automotive division), said it was encouraging that enquiry and booking levels in September were significantly higher than in previous months both for UVs and SCVs. “With market sentiments indicating a robust festive demand across segments, both in rural and urban markets, we are positive that this festive season will augur well for us as well as the automotive industry,” he said.
Tractor sales at M&M continued to grow and registered an increase of 18% increase y-o-y. Hemant Sikka, president (farm equipment sector), M&M said retail demand continued to be buoyant backed by a very good monsoon, higher kharif acreage and continued government support, including higher MSPs for key crops. “We are looking forward to a very robust demand for the festive season ahead,” Sikka said.
Vehicle sales for Toyota Kirloskar Motors (TKM) also bounced back in September, as it recorded an increase of 46% on a m-o-m basis to 8,116 units. However, y-o-y sales remained muted with a decline of 20.4%. Naveen Soni, Senior VP (sales & service) TKM said September has been the best month for the company since March. “We are seeing demand pick up and a lot more confidence in our dealers and witnessing a 14-18% increase in orders when compared to the last few months. Factors leading to this can be attributed to the pent-up demand among customers as well as the onset of the festive season,” he said.
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