Good news for automakers; festive season sales soar; Hyundai to Hero MotoCorp, every segment doing well

Mumbai | Published: October 4, 2017 5:38:27 AM

It’s been a good September for automobile players, with most companies turning in strong wholesale volumes. From Hyundai to Hero Motocorp to Ashok Leyland, every segment has done well, bouncing back from the lows of June.

Analysts at Nomura observed that the early festive demand has been good, delivering double-digit retail growth for most manufacturers. For their part, companies are pushing retail sales.Analysts at Nomura observed that the early festive demand has been good, delivering double-digit retail growth for most manufacturers. For their part, companies are pushing retail sales. (Reuters)

By-Deepak Kumar

It’s been a good September for automobile players, with most companies turning in strong wholesale volumes. From Hyundai to Hero Motocorp to Ashok Leyland, every segment has done well, bouncing back from the lows of June.

Analysts at Nomura observed that the early festive demand has been good, delivering double-digit retail growth for most manufacturers. For their part, companies are pushing retail sales.

“Most companies have introduced festive discounts to boost sales. While Hero Motocorp is offering around Rs 3,000 discount on scooters, Bajaj Auto is shaving off about Rs 1,000-2,100 for its commuter segment bikes. In addition, there is a Rs 1,500 discount for government employees by Honda (HMSI) and HMCL as well,” they said.

Citing information received from dealer channels, analysts at Motilal Oswal say that the festive season has helped improve retail sales for two-wheeler makers by 10-15% year-on-year. They add that a good monsoon and an increase in crop realisations have lifted sentiments in rural/semi-urban areas as well.

Hero Motocorp sold a whopping 7,20,739 units in September, which is an all-time high for the company in terms of monthly sales. Owing to a high base, the company’s volumes grew 6% in the period. Ashok Bhasin, head of sales, marketing and customer care, Hero MotoCorp, said, “With close to three weeks still remaining in the festival season, we have set an all-time record by selling over a million motorcycles and scooters in domestic retail sales in the festive period so far, further consolidating our market leadership.”

Volumes for TVS Motor during September grew by 21% to 3,07160 units compared with the same period last year. Its scooter sales witnessed a 43% rise in the period year-on-year. September also witnessed Bajaj Auto reporting positive sales growth for the first time this fiscal — growing by 7% at 2,47,418 units.

Meanwhile, Eicher’s Royal Enfield bikes notched up a 22% growth to 70,432 units in September, compared with the year-ago period, on the back of robust growth in vehicles with up to 350cc engines.

Save Ford, even the four-wheeler category is basking under festive glory.

Growth in Ford india declined by 2% in September to 8,769 units. Also, the company’s exports almost halved to 7,756 vehicles compared with 13,572 units in the corresponding month last year. The company cites supply constraints for such southbound performance.

Utility vehicle (UV) maker Mahindra and Mahindra (M&M) reported a 26% rise in its UV volumes. The company is confident of sustaining its growth momentum for the rest of the festive season. Rajan Wadhera, president, automotive sector, M&M, said, “The auto industry has witnessed a buoyant demand in September leading up to the festive season. This upsurge has been witnessed both in urban and rural markets. We are particularly happy with the performance of our Scorpio brand, which has had its highest monthly sales in September, since inception.”

The second largest carmaker in the country, Hyundai, posted its best ever monthly numbers at 50,028 units, growing at 17.4% compared with the same period last year, thanks to its newly-launched Verna and continued strong demand for the Creta, Elite i20 and Grand i20. The chaebol is now considering expanding its manufacturing capabilities in India, as the high base effect puts a serious restraint on its growth.

Meanwhile, with the increasing supply of BS IV (Bharat Stage 4) parts and improvement in freight rates, commercial vehicle makers too have seen a healthy rise is sales this festive season.

Ashok Leyland’s M&HCV volumes rose by a strong 32% to 11,804 against the 8,958 units it reported in the same period a year ago. Mumbai-based M&HCV giant Tata Motors too posted volumes growth of 25% to 12,259 units during September.

Analysts, however, observed that rural demand trends seem soft given the approximately 5% monsoon deficit with uneven distribution.

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