Auto sales in August belied all hopes of the sector being out of the woods after last month’s stellar numbers as sales by different manufacturers showed a very patchy growth, reports fe Bureau in New Delhi. The figures underline the fact that the market remains soft and some positive numbers in the past few months have been only on the back of some new launches and in other cases, on the back of discounts .
The biggest indicator of the rural economy being under stress and that any broad-based growth is still elusive is the 14% yearly decline in sales of the country’s largest two-wheeler manufacturer Hero MotoCorp. This is the company’s worst performance in almost last two years. According to Rakesh Batra, partner and national leader, automotive sector, EY, since bulk of the company’s bikes in the small category ranging from 75-125 cc cater to the rural market, the slide was inevitable.
Maruti’s sober 8.6% yearly growth in passenger vehicles is seen by analysts as more realistic than the previous month’s stellar 23% growth which was on the back of a low base. The decline of 11% in sales of compact cars like Swift and Dzire reflect that the market is still soft. Though Hyundai grew at 20% which the company claims the best-ever in terms of volumes it is basically on the back of the launch of a new compact SUV Creta recently.
“The growth that we are seeing in the industry is because of the new models. If you take out the new models, industry growth will be in the negative,” Tata Motors president (passenger vehicles business unit) Mayank Pareek said.
The sentiment was echoed by M&M chief executive (automotive division) Pravin Shah, who said, “Currently we are witnessing fragmented recovery in auto sales, we are hopeful that the upcoming festive season will provide a much needed fillip to the industry”.