December sales: Maruti, M&M post marginal rise, other automakers witness slide

Maruti Suzuki India (MSI) announced its domestic passenger sales at 1,24,375 units for December 2019, as against 1,21,479 units in the year-ago month, registering a growth of 2.4 per cent.

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For calendar year 2019, MSI posted a 13.7 per cent decline in domestic sales (15.11 lakh units) over that in 2018 (17.51 lakh units).

December continued to be a bad month for a majority of auto manufacturers. While market leader MSI (2.5 per cent) and M&M (1 per cent) announced a rise in their year-on-year (y-o-y) domestic sales in December 2019, other major manufacturers including Hyundai Motor India (HMIL), Honda Cars India and Toyota Kirloskar Motor (TKM) announced fall in domestic sales between 7 per cent and 45 per cent.

Maruti Suzuki India (MSI) announced its domestic passenger sales at 1,24,375 units for December 2019, as against 1,21,479 units in the year-ago month, registering a growth of 2.4 per cent. For calendar year 2019, MSI posted a 13.7 per cent decline in domestic sales (15.11 lakh units) over that in 2018 (17.51 lakh units).

On the other hand, HMIL announced a 9.8 per cent decline in sales in December 2019 and Honda Cars announced a 36 per cent decline in domestic sales at 8,412 units. TKM also announced a sharp decline of 45 per cent in its sales for December, which fell from 11,836 units in December 2018 to 6,544 units last month.

Hyundai and Toyota ended 2019 with an aggregate decline in sales of 7.2 per cent and 16.4 per cent, respectively, over 2018.

Maruti saw rise in sales in the compact and utility vehicle segments. While the company witnessed a 27.9 per cent jump in sales in the compact segment (New WagonR, Swift, Celerio, Ignis, Baleno, Dzire), the utility vehicle segment (Ertiga, XL6, S-Cross and Vitara Brezza) saw a 17.7 per cent jump. It, however, witnessed a 13.6 per cent decline in the mini segment and 62 per cent decline in sales in mid-size segment.

Mahindra & Mahindra (M&M) saw a 1 per cent rise in domestic sales at 37,081 units in December, as against 36,690 units in December 2018. “Our performance in December is as per year-end sales outlook and currently we are also comfortable with our overall stock levels,” said Veejay Ram Nakra, chief of sales and marketing, automotive division, M&M.

Tarung Garg, director—sales, marketing and service, HMIL, said 2019 has been a challenging year for the Indian automotive industry. Stating that the decline in sales have been on expected lines, several firms said they are now working towards a smooth transition to rollout of BS-VI vehicles over the next three months.

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Auto firms to focus on clearance of BS-IV inventory

The continued slowdown in consumer sentiment impacted sales of several car manufacturers in December 2019, as several of them posted decline in year-on-year sales numbers. As the deadline for shifting to BS-VI is just three months away, many manufacturers are now focussing on liquidating BS-IV stocks and maintaining a lean inventory. It remains to be seen as to how automobile manufacturers deal with the BS-IV inventory and whether they will offer big discounts between January and March.

Rajesh Goel, senior VP and director—sales and marketing, Honda Cars India, said, “Our volumes in December 2019 have been on expected lines. In order to avoid any leftover BS-IV stocks, we channelised our resources more towards liquidating them.”

TKM also said that it has been gradually liquidating BS-IV stocks across India to maintain a lean inventory and not put any excess burden on dealerships before the shift to BS-VI in April 2020.

Even as TKM saw its sales decline 45 per cent in December, the company said that it has witnessed positive sales momentum. Stating that the company is consciously lowering the volumes sold to dealers to ensure a smooth transition to BS-VI by April and ensure that there is no pending BS-IV inventory at dealerships by March 30, which will be unsaleable post the transition, Naveen Soni, senior VP—sales and service, TKM, said, “We are happy that there has been a continued positive retail sales momentum despite the overall slowdown in the industry.”

On the other hand, new entrant MG Motor India announced a sale of 3,021 units in December last year.