Car Sales Decline By 10.43% In April 2013: SIAM

On May 1, 2013, automobile manufacturers released their sales volume figures for the month of April 2013. A glance at these numbers foreshadows the dismal cumulative sales figures for the industry.

Maruti Suzuki (MSIL), the largest car manufacturer, saw its sales volumes decline by 3.10%, while Hyundai, the second largest player, saw a decline of -7.6%. The sales of players like Toyota and Ford went down by 37% and 24.03% respectively.

The picture was no different for two-wheelers, with the sales volumes of Hero MotoCorp, Bajaj Auto and TVS Motor falling by 10%, 10% and 5.3% respectively.

An interesting trend that panned out was a moderation in sales of high-growth segments like Utility Vehicles and Light Commercial Vehicles. While the overall industry had been suffering since the beginning of FY13, these two segments were the only ones with robust performance. However, since the sales were strong, now the base has grown larger and hence volumes growth is seeing moderation.

These trends are all the more evident in the data released by SIAM on May 10, 2013. According to this data, the overall domestic sales across the industry declined by 0.34% in April 2013 as compared to that in April 2012. The sales of passenger vehicles dropped drastically by 8.21% on a yearly basis. In this segment, passenger cars and vans witnessed a decline of 10.43% and 13.42% respectively. The strongly performing UV segment grew by a mere 3.99% YoY in April 2013.

Commercial Vehicle (CV) sales were flat in April 2013, having grown by a mere 0.75% as compared to that in April 2012. This was because of the polarised trend in Medium and Heavy Commercial Vehicles (M&HCV) and Light Commercial Vehicles (LCV). The sales of the former declined by 6.66%, while those of the latter grew by 4.81% on a yearly basis.

Growth in two-wheelers was flat at 0.95% in April 2013. Moped and motorcycle sales declined by 7.2% and 2.06%, while scooter sales grew by 14.72%.

Exports too were subdued in April 2013, having declined by 9.14%. However, this decline was primarily due to the decline in export volumes of two-wheelers, which witnessed a decline of 17.84%.

Overall, the situation in the automobile industry continues to remain weak and there seem to be no sign of improvement. Fuel prices and funding costs are among the major reasons for the poor demand. However, with the recent fall in global oil prices and some ameliorative action on the monetary front, we may start seeing the positive effects once the impact of these changes seep down to end consumers. Till then, the industry is expected to continue its disappointing performance.