Improved supplies of semiconductors and healthy booking volumes led automakers to report better wholesale despatches in the month of January 2022. Though sales continue to be lower compared to last year, the fall is not as steep as was being witnessed in the past four months.
India’s largest passenger vehicle manufacturer, Maruti Suzuki sold 1,32,461 units in January, registering a decline of 7% on a year-on-year basis. This is a significant improvement over the decline of 14% in wholesale numbers reported for December 2021 with 1,26,031 units sold. On a month-on-month basis too, there has been an improvement in auto sales with a 5.1% increase registered over December.
However, the company continues to sell below its traditional average monthly sales of 1.5 lakh units per month. Maruti said on Tuesday that it took all possible measures to minimise the impact of electronics component shortage, however, it had a minor impact on the production of vehicles primarily sold in domestic market.
Hyundai Motor India’s domestic sales declined by over 15% y-o-y to 22,832 units. This was also an improvement over December numbers, when the fall was 32%. However, on a month-on-month basis Hyundai sold about a third of 32,312 units sold in December, which it attributed to the ongoing semiconductor shortage.
However, Tata Motors’ total domestic wholesale volumes were up 26% y-o-y to 72,485 units during January and 9% on a m-o-m basis. Passenger vehicle sales were up a sharp 51% y-o-y to 40,777 units.
Commercial vehicle manufacturers Ashok Leyland and Tata Motors both witnessed an improvement in volumes aided by strong demand for intermediate commercial vehicles and tippers. While commercial vehicle wholesales for Tata Motors were up 7% on a y-o-y basis to 35,268 units, Ashok Leyland reported a 3% y-o-y rise in sales volumes to 12,709 units. According to analysts, the launch of CNG variants should support volumes ahead for Ashok Leyland.
Mahindra and Mahindra (M&M) clocked total domestic sales of 43,943 units, an increase of 19% y-o-y, while on a m-o-m basis the sales surged 21.5%. While commercial vehicle sales surged 58% y-o-y to 21,111 units, passenger vehicles sales in January declined 3% y-o-y to 19,964 units. Veejay Nakra, chief executive officer (automotive division), M&M said, “Despite various global supply chain challenges, we fulfilled our commitment of billing the first 14,000 XUV700s by January 2022 and have registered close to one lakh bookings since launch. We continue to closely monitor the semi-conductor related parts issue and take corrective action as appropriate.”
Tractor sales at M&M continued in the slow lane, with sales suffering a sharp fall of 37% y-o-y to 21,162 units in the month of January. The decline was sharper compared to y-o-y fall of 21% in December. The company has attributed this to the high base of last year and incessant rains in some states. Hemant Sikka, president (farm equipment sector), M&M said, “On the back of good rainfall and high moisture content in the soil, Rabi sowing has been very good, and this bodes very well for a bumper crop harvest. Continued Government focus on agriculture, rural infrastructure and higher cash flows with rabi harvest, will lead to positive sentiments and increase in tractor demand.”
Two-wheeler manufacturers continued to report weak sales due to muted customer sentiments and the high base effect. The demand was further impacted due to delay in reopening of offices and educational institutions with concerns surrounding the third wave of Covid.
Additionally, chip shortage has affected dispatches of premium motorcycles. Bajaj Auto reported a 12% y-o-y decline in wholesale numbers with 1,49,656 units sold in January 2022.
