Auto sales take a beating following demonetisation
Passenger vehicle sales in India inched up 1.82% in November, the lowest clip since February this year, even as two-wheeler sales fell nearly 6% as currency pullback affected sales, especially in rural areas.business Updated: Dec 08, 2016 15:16 IST
Passenger vehicle sales in India inched up 1.82% in November, the lowest clip since February this year, even as two-wheeler sales fell nearly 6% as currency pullback affected sales, especially in rural areas.
According to Society of Indian Automobile Manufacturers (SIAM), passenger vehicle sales last month were at 2,40,979 units, as against 2,36,664 in November, 2015.
Domestic car sales ticked up to 1,73,606 units as against 1,73,111 in November last year while that of commercial vehicles (CVs) was down 11.58% at 45,773 units in November, SIAM said.
Vehicle sales across categories registered a decline of 5.48% at 15,63,665 units, from 16,54,407 in November 2015. It is the steepest decline in 43 months when total sales had declined by 7.75% in March, 2013.
“In November, companies were able to push stock to dealers as the inventory levels were down owing to a good festive season in October. So, the impact is not visible at wholesale levels. It will be only clear after this month after taking into account retail sales,” SIAM director general Vishnu Mathur said.
Over 85% of the passenger vehicles are financed. So, people are just postponing buys while the impact is visible in rural areas, especially in the two-wheeler space, where cash component plays a major role, he added.
“So, two-wheeler sales are giving out a true picture of the current situation. Also, for car companies which have long waiting periods for some of their models, the impact would be less as compared to others which do not have any backlog to clear,” Mathur explained.
Even fast-growing utility vehicles sales posted 10.01% growth during the last month, the lowest pace in the past 10 months.
However, in April-November, total vehicle sales across categories grew 12.5% at 1,54,20,035 units as against 1,37,07,157 in the year-ago period.
Mathur said footfalls declined at showrooms during the first week after demonetisation, but the situation recovered in the weeks that followed.
“We expect it to be a temporary disruption and expect industry making a comeback January onwards. The picture would be clear over the next two-three months,” he said.
During November, market leader Maruti Suzuki India saw its car sales rise by 8.14% to 96,767 units as against 89,479 in the same month last year. The company’s utility vehicle sales, however, jumped 98.14% to 17,215 units as against 8,688 in November last year.
Rival Hyundai Motor India reported a decline of 12.83% in its domestic car sales at 32,923 units compared with 37,771 units in the year-ago period. Its utility vehicles sales came in at 7,093 units as against 5,880 last year, up 20.62%.