Automobile Sales Decline In Q1FY14

SIAM (Society of Indian Automobile Manufacturers) has announced the auto sector sales figures for the period April-July 2013 (Q1FY14). The industry has been facing pressures due to poor consumer sentiment and low industrial production, caused by weak macroeconomic conditions. Overall, domestic sales fell by 2.09% in the quarter as compared to Q1FY13.

During the period, passenger vehicle sales figures dropped by 7.49% from that in Q1FY13. The sales of passenger cars and vans were 9.73% and 2.39% lower respectively. At the same time, the sales volumes of utility vehicles dropped by 1.03% in Q1FY14. In the previous months, utility vehicles had been showing a strong YoY growth in volumes. However, due to stabilisation of sales, this is now in a flattish trend.

The situation was no different in the case of commercial vehicles, in which sales dropped by 9.91%. The sales of medium and heavy commercial vehicles declined the most on account of low industrial output and decreased activity in construction and mining. In Q1FY14, the sales of this segment declined by 16.65% over the previous year. A fall of 6.11% was seen in the sales of light commercial vehicles.

Domestically, the sales of three-wheelers also declined, down 3.45% in the quarter. Sales of passenger carriers and goods carriers fell by 2.84% and 6.05% respectively.

Helped by the growth observed in scooter sales, the sales of two-wheelers remained stable, a mere 0.64% lower. While the numbers for mopeds and motorcycles dipped by 13.07% and 3.4% respectively, scooters grew by a robust 13.11%.

On the exports front, automobile sales saw a downfall of 3.37%. Heavy movement was seen in exports as compared to the sales in the previous year same quarter. In the elapsed quarter, commercial vehicle exports declined by 26.53%, while three-wheeler exports grew by 46.47%. The numbers for passenger vehicles and two-wheelers changed by 2.39% and -9.88% respectively.

Overall, automobile sales have been continuing their downward trend. A weakness in demand is being seen across segments. Sales have been robust only for manufacturers who have models that have become popular among consumers. The monsoon season provides some optimism, and some revival can be expected in the festive season on account of increased rural demand.