Dec car sales up 8% on discounts, launches

While Maruti Suzuki reported a 13.5% increase in domestic sales, Hyundai's sales grew 28.8%

It was a delightful December for India’s top car makers — Maruti Suzuki and Hyundai — which, helped by new launches, year-end discounts and low fuel prices, drove industry sales volume up nearly eight per cent from the same period a year ago.

Utility vehicles major Mahindra & Mahindra managed to stay in positive territory despite several of its models being impacted by diesel ban in Delhi/NCR.

India’s largest car maker, Maruti Suzuki has reported a 13.5 per cent increase in domestic sales for December 2015, helped by launch of Baleno in October. The utility vehicle segment also grew for Maruti, helped by S Cross, launched in August. Maruti’s domestic sales in December was 111,333 units, the company said in a statement on Friday. Its domestic sales in the nine months ending December 2015 rose 13.9 per cent to 971,958 units.

Car makers offer steep discounts in December to clear the stocks. December growth of eight per cent is significant because December 2014 was a high base month on apprehensions of the rollback in excise benefits. Car sales had grown by over 15 per cent in December 2014.

Companies have also announced average price increase of two-four per cent from this month.

Hyundai, the second-largest player, reported a stronger domestic sales growth of 28.8 per cent last month despite Chennai floods that led to production loss. The company’s domestic sales rose to 41,861 units in December, thanks to strong demand for Creta and Grand i10. “We couldn’t have asked for anything better. We have done domestic sales of over 40,000 units for last five months in a row,” said Rakesh Srivastava, Hyundai’s senior vice-president (sales & marketing).

Ford has reported a 58 per cent increase in domestic sales during the month, helped by launches of Figo and Aspire.

“Raining discounts, new products and improving sentiments have been major drivers for last month’s growth. We expect this growth trajectory to continue in 2016. New Products and differentiation strategies are going to be the key enablers for growth”, said Amit Kaushik, country head, JATO Dynamics, an international automotive consulting firm.

Like most of 2015, December growth was led by handful of players only. Japanese car maker Honda did not announce December data but according to industry sources, sales declined by over 14 per cent. Toyota, another Japanese player, saw sales decline by 11 per cent. Toyota did not launch a new product in 2015. Tata Motors saw a 33 per cent decline in December. Bad times continue for German auto maker Volkswagen which was hit by a global diesel emission scandal in September. Its volume declined 37 per cent in December. GM also saw a sales dip of 20 per cent from December 2014.