New launches and discounts boost July car sales in India

Written by ENS Economic Bureau | New Delhi | Updated: Aug 2 2014, 14:18pm hrs
Honda-MobilioFor Honda Cars India, the newly-launched Mobilio (3365 units) along with new City and the Amaze helped grow sales by 40 per cent.
Domestic car makers clocked the third consecutive month of growth in demand, with vehicle sales rising by 13 per cent in July.

Eight of the countrys leading automobile manufacturers that released their sales data on Friday cumulatively sold 1,83,176 units in July as compared to 1,64,572 units sold in the corresponding month last financial year.

Leading the charts was market leader Maruti Suzuki, which recorded a growth of 19.9 per cent to sell 90,093 units in the domestic market last month. Even as the sales of Marutis small cars Alto and WagonR declined by 14.4 per cent to 28,759 units, demand for its premium models improved.

Sales of Swift, Ritz and Celerio increased by 81.2 per cent to 25,156 units, of sedan DZire by 22.2 per cent to 18,634 units, of utility vehicles Ertiga and Grand Vitara by 23.4 per cent to 5,631 units and of utility vans Eeco and Omni by 54.8 per cent to 11,680 units.

Korean car major Hyundai too recorded a spurt in volumes by 12.7 per cent to 29,260 units during the month.

Rakesh Srivastava, senior vice-president (sales and marketing), HMIL said, The demand pull created by the successful product launches and strong channel spread has brought down the discounts and the green shoots of growth are visible with the stabilisation of macro-economic factors and near to average Monsoon.

Kumar Kandaswami, senior director, Deloitte Touche Tohmatsu India Private, however, advocated a bit of caution in extrapolating the demand trend. The last two months saw some panic buying in anticipation of tax increases and the release of some pent up demand. For sustained growth to happen, one would want to see six months of growth in disposable income over inflation and the increase in the levels of household savings. It is important the entry segments gather speed as those customers are the most affected by inflation and lack of income growth.

Meanwhile, new launches helped boost numbers for Honda Cars India and Toyota Kirloskar. For Honda Cars India, the newly-launched Mobilio (3365 units), new City (7,705 units) and the Amaze (4507 units) helped grow sales by 40 per cent. The sedans contributed as much as 78 per cent to Hondas overall passenger vehicle sales in the domestic market.

For Toyota, the newly-launched Corolla Altis and Etios Cross accounted for 1,770 of the 11,921 units sold last month. There are several indicators to suggest a gradual revival in customer sentiment in the past few months, including cues from the stock market and a steady improvement in manufacturing index. As we approach the festive season, we expect a significant increase in footfalls ... We have improved supplies to expedite deliveries for all our models, including the bestselling EcoSport, to meet the expected rise in demand in the coming months. said Vinay Piparsania, executive director of Marketing, Sales and Service, Ford India.

Domestic firms Tata Motors and Mahindra & Mahindra (M&M) continued to see sluggish demand. While Tata Motors sales fell 15 per cent to 9167 units, M&Ms was down 5.3 per cent to 14,708 units.