Maruti Suzuki leads overall sales numbers despite a year-on-year drop

Maruti Suzuki had an interesting sales year as the results came out to be quite different from what the company usually has. There was a demand in premium hatchbacks, compact utility vehicles and mid size sedans pushing Maruti Suzuki’s traditional products like the Alto, Swift and Dzire down the line.

According to stats , the volumes during the period of April and October for the Alto fell 9.36 percent year-on-year to 1,39,574 units while the Swift fell 23.44 percent year-on-year to 95,367 units. Maruti’s compact sedan Dzire slipped by 22.13 percent year-on-year 97,127 units. Sales of the Swift and Dzire usually cross the 1 lakh mark in the first seven months of the year, however that was not the case this time around.

Maruti did see an increase in the volumes for the Celerio and Wagon R around 2 percent year-on-year thanks to the high demands of cab services like Ola and Uber. Among the top 10 best selling in India, Maruti’s Alto retained the number one position in October with 18,854 units followed by Dzire with 15,201 units according to the latest data from the Society of Indian Automobile Manufacturers (SIAM). However compared to last year’s results, Maruti has seen a decline in sales for their top selling car the Alto.

Ajay Seth, Chief financial officer, Maruti Suzuki said. “It’s difficult to attribute to a particular reason but it could be the state of the economy and the relatively slow job creation which drives growth in this segment.”

“We believe MSIL margin will cross its historic peaks over the next few years as competitive launches are weak, Maruti has started to capture market share in highly profitable segments (compact SUVs, premium hatchback) and the company’s expansion of distribution centers at a faster pace than competition due to strong dealer profitability,” said analysts of Kotak Institutional Equities in a report on the company.