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Thursday, January 21, 2021

Pent-up demand, festive season keep passenger vehicle sales in fast lane in Dec

Future demand to be driven by availability of Covid vaccine, economic revival

By: ENS Economic Bureau | New Delhi | January 2, 2021 3:58:48 am
passenger vehicle sales, PV sales growth, automobile manufacturers, festive season, economy news, Indian express newsIn aggregate, the six manufacturers — MSIL, Hyundai, Tata Motors, M&M, Honda Cars and TKM— sold 2,44,006 units in December 2020 in the domestic market

Riding on pent-up demand, festive sales uptick and growing preference for personal mobility, country’s leading passenger vehicle manufacturers witnessed strong growth in domestic sales in December 2020. While the country’s largest car manufacturer, Maruti Suzuki India Limited announced a 14.6 per cent jump with sales of 1,40,754 units in the domestic market, Hyundai Motor India announced sales of 47,400 units in December, registering a 24.9 per cent jump over sales in December 2019.

Among other manufacturers, while Tata Motors announced a strong 84 per cent jump with sales of 23,545 units in December, Toyota Kirloskar Motors announced a 14.4 per cent growth rate in year-on-year sales in December. Honda Cars India and Mahindra & Mahindra announced 2.7 per cent and 3.1 per cent growth, respectively.

In aggregate, the six manufacturers — MSIL, Hyundai, Tata Motors, M&M, Honda Cars and TKM— sold 2,44,006 units in December 2020 in the domestic market, as against 2,04,169 units in December 2019 — registering a growth rate of 19.5 per cent.

For the market leader, MSIL, the compact segment (WagonR, Swift, Celerio, Ignis, Baleno and Dzire) witnessed strong demand of 18.2 per cent and the segment accounted for 55 per cent of total PV sales for the company. The mini segment (Alto and S-Presso) witnessed 4.4 per cent growth in December over the corresponding month of the previous year.

While several manufacturers credited the growth in sales to festive sales and pent-up demand, there is a feeling that the future demand would be driven by availability of vaccine and revival in the economy.

Stating that Hyundai achieved a new milestone in monthly production at 71,178 units in December, SS Kim, MD & CEO, HMIL said, “Looking towards the future, we are proceeding with cautious optimism and positively anticipate green shoots of recovery in 2021.” In fact, HMIL also became the largest auto exporter from India for calendar 2020 with sales of 98,900 units.

Rajesh Goel director, marketing and sales at Honda Cars, said with availability of novel coronavirus vaccines in 2021, he expects return of optimism to the market and boost in the consumer sentiment going forward.

As Tata Motors witnessed strong growth in December and has seen its passenger vehicle sales grow by 89 per cent in the quarter ended December 2020, with highest ever sales in last 33 quarters, Shailesh Chandra, president, PV business, Tata Motors said, “The PV industry continued to grow robustly in Q3FY21, owing to pent up demand, strong festive season and shift towards personal mobility… We are continuing to debottleneck the supply chain and ramp up our output to meet the increased demand while addressing the availability of electronic components.”

Several manufacturers have been facing supply chain constraints and an issue with availability of electronic components. In a statement issued on Friday, M&M said that its overall sales have been affected due to the continuing supply chain challenges related to the constantly changing global environment, more specifically the supply shortage of micro-processors (semiconductors) used in Electronic Control Unit (ECUs).

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