Maruti June sales zoom - but it's just a statistical blip

New Delhi: Maruti Suzuki India recorded a spectacular jump in wholesale sales last month. While a spurt in the sales of two cars - Swift Dzire and the new utility vehicle (UV) Ertiga - led to an overall surge in a sluggish market, one must remember that last June, the company had not produced enough cars due to a strike by its workers and, therefore, the growth this month is on a lower base.

The company reported a 20.30 percent jump in total sales at 96,597 units (80,298 units). Domestic sales were 83,531 units (70,020 units) in the year-ago period, up 19.3 percent. Exports went up 27.13 percent to 13,066 units last month (10,278 units).

Already, enquiries and footfalls at dealerships are declining and Maruti is offering substantial discounts on its petrol models to spur sales. Besides, block closure of its two factories for some days in June would mean it has been able to align production with demand. As expected, the mini segment (including the M800, A-Star, Alto and WagonR) reported an over 10 percent decline to 34,198 units (38,183 units). Mid-sized sedan SX4 slipped to almost half its volume in the year-ago period at 408 units (713 units) on tough competition from newer models.

But the compact segment (comprising the Estilo, Swift and Ritz models) grew almost 40 percent to 22,624 units (16,239 units). Sales of DZire were up five-fold to 13,741 units (2,486 units).

Reuters

Hyundai Motor India, the second largest car-maker, reported marginal year-on-year growth this June whereas Tata Motors reported a decline in sales. Hyundai sold 54,354 units (52,521 units) in June, up 3.5 percent. Domestic sales were flat at 30,450 units (30,402 units)

and growth came from exports which rose by 8 percent to 23,904 units (22,119 units).

The general inflationary trend, high fuel prices, and interest rates that are still high are keeping the domestic car market sentiment low. Unless there is some sort of stimulus from the Prime Minister (who is now also looking after the finance portfolio), sentiment is not expected to improve in the near future.

Tata Motors reported a 3 percent decline in its total sales in June this year at 64,341 units.

The combined domestic sales of commercial and passenger vehicles declined by 5 percent but the decline in passenger vehicles alone was steeper at 22 percent. Tata Motors sold 17,244 units (21,994 units) where Nano and the UVs helped growth. Sales of the Nano rose three percent to 5,605 units (5,452 units) ; the Sumo, Safari, Aria and Venture range together sold 3,649 units (3,472 units). But sales in Indica range were almost half the number achieved in June last year at 5,332 units (8,188 units) and the Indigo range declined by a similar margin to 2,658 units (4,882 units).