Three-wheeler sales drop by 11% in FY20 sales: TVS only manufacturer to report positive growth

All OEMs, except TVS report overall degrowth.

By:April 30, 2020 10:34 AM

The three-wheeler industry has reported 11% decline in sales in FY20 to 11,33,858 units against 12,68,833 units sold in the previous financial year. While the domestic sales during the fiscal year declined 9% to 636,569 units (from 701,005 units), exports, which generally help the industry offset the domestic blues, de-grew 11.5% to 502,169 units (from 567,683 units). The industry, which usually push more vehicles into the market in the last month of every financial year, March, could not do so this time due to the lockdown — both domestically and globally post COVID-19 outbreak.

The March sales plummeted by a whopping 50% to 59,813 units as compared to 120,578 units sold in the same month of FY19, revealed SIAM data. Except TVS Motor, almost all players, including market leader Bajaj Auto, and Piaggio have reported degrowth during the fiscal, the data pointed out. While Bajaj Auto reported a 15% drop in its FY20 sales to 662,773 units, Mahindra & Mahindra reported a 17% drop in its sales figure to 58,205 units. Piaggio, on the other hand, also reported degrowth of 11% to 188,338 units.

Aided strongly by exports, TVS Motor is the only one to report 12% growth in its overall sales during the period under review to 173,993 units. Other players such as Atul Auto and Scooters India also reported 13% and 20% degrowth, respectively, the SIAM data pointed out. Bajaj Auto’s domestic sales declined 8.53% during the fiscal to 364,817 units and the exports, on the other hand, declined sharply by 22% % to 296,700 units. TVS Motor, which purely depends on exports to offset the domestic blues, saw its domestic sales at a meagre 11,934 units during the fiscal (a decline of 29%), but it did well on exports with 16% growth to 161,977 units.

After Bajaj Auto, Piaggio came second with its domestic sales at 152,386 units (10% degrowth), followed by Mahindra & Mahindra with 58,145 units (degrowth of 12%). Within the entire vehicles industry, passenger vehicle sales were at 10,17,051 units in the fiscal under review (a decline of 10%), while the sales of the goods variant were at 116,807 units (a decline of 14%) against the same period last fiscal, the SIAM data added. ICRA had in its earlier analysis said that abolition of permit regime in large three-wheeler markets like Maharashtra and Gujarat along with issuance of fresh permits in Delhi, Karnataka, Andhra Pradesh and Telangana had extended the much-needed impetus to the domestic three-wheeler volumes in FY2018 and H1 FY2019. However, the segment had been declining since the latter half of FY2019, impacted primarily by the high base and the liquidity constraints in the economy, which has blocked potential financing avenues available for three-wheeler buyers.

Moreover, many states have started working aggressively on their electric vehicle policy, of which electric three-wheelers constitute a prime focus area. States like Karnataka have proposed phase-out of two-stroke autos and a ban on diesel vehicles in Bengaluru. The southern market is expected to witness significant changes going forward, Icra said. According to the ratings agency, export volumes from India have been volatile over the years, in line with the economic scenario and regulatory developments in key markets. With annual sales of around 3 lakh units, Africa is the largest export market for Indian three-wheeler OEMs. However, the market remains exposed to fluctuations, with volatility in forex rates and economic downturns impacting the demand. Nigeria and Egypt are the two largest markets in the region, the Icra analysis pointed out.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Latest Auto News