New Delhi: The passenger car industry just can't seem to make up its mind -is there a slowdown in sales or not?
Though car makers complain of piling petrol inventories and a slump in demand, the data from the Society of Indian Automobile Manufacturers (SIAM) show that June sales this year were the highest ever in this month since 1997! But month on month, the growth has slowed, with domestic car sales numbers the lowest since October last month.
Even SIAM has refused to make any significant correction in its forecast for car sales this fiscal despite the first quarter sales growth being less than half it had projected for the year in April.
SIAM's revised car sales growth forecast this fiscal stands at 9-11 percent against 10-12 percent it made at the beginning of the fiscal, even when car sales grew by a mere 5.22 percent between April and June this year.
So is SIAM, and therefore the car industry, refusing to acknowledge any slowdown or have they cried wolf unnecessarily?
SIAM President S Sandilya says stable prices of petrol, stable auto loan rates and high discounts have ensured that sales remain healthy in the June quarter.
He is also optimistic that sales growth will improve in the remaining quarters of FY13, especially around the festival season.
Sandilya acknowledges that cars are being sold with high discounts and therefore the numbers might look healthy but actually sales margins are falling.
SIAM does not track either retail sales or sales margins; so the sales numbers and all forecasting are done on the basis of factory dispatches.
For June, domestic passenger car sales stood at 155,763 units (143,851 units) when production remained almost flat. Car makers are juggling production schedules to inventory levels in check and this was apparent since production was 189,681 units (180,828 units).
Production of the Tata Nano was down, ditto for mini cars such as Maruti's Alto, A-Star and WagonR, the Chevy Spark and the Hyundai Santro.
Production of bigger hatchbacks was also down - in fact, of eight categories of passenger cars (categorised on the basis of length, wheel base and number of seats) only entry level and mid-sized sedans were produced in more numbers than the previous June, every other category showed a decline.
The production increase and consequent sales spike in entry level sedans was largely due to the Dzire - Maruti produced 15,427 units of this car this June against just 2,162 units in the same month last year (when production was affected due to strike at its facilities) and sold 13,741 units (2,486 units). For mid-sized sedans, Nissan Sunny and Skoda Rapid were the stars. The Sunny sold 3,066 units, whereas the Rapid clocked 3,246 units.
Then, as per the SIAM data, total two-wheeler sales in June this year grew 9.2 percent to 11,69,733 units (10,71,161 units). Sales of commercial vehicles grew 4.71 percent to 64,926 units (62,007 units) while total sales of vehicles across categories registered 9.05 percent growth to 14,85,744 units (13,62,495 units).
Sandilya said the SIAM forecast made in April remains largely unaltered for most vehicle categories except Medium & Heavy Commercial Vehicles (Goods Carriers), passenger buses and three-wheeler goods.
Published Date: Jul 10, 2012 16:12 PM | Updated Date: Dec 20, 2014 10:07 AM