Rising car sales in April hint at a recovery

Car makers see pickup in economic activity leading to better financial year

Passenger vehicle sales grew 19 per cent in April over the same month in 2014. This follows a subdued 2014-15, when sales grew only 6.8 per cent.

Launches, promotions and urban demand helped the seven top automobile makers that make up 85 per cent of the market sell 186,197 vehicles last month against 156,419 in April 2014.

The wedding season, lower fuel prices and cheaper credit also helped improve sentiment, car makers said. Enquiries at dealerships improved from earlier months but discounts were stubbornly high, especially on low-selling models.

Sales of two-wheelers, however, took a hit in the month, falling a third of a percentage point year-on-year.

Market leader Maruti Suzuki led the growth, with sales settling above 100,000, an increase of 27 per cent year-on-year. Its new launches — the Ciaz, Celerio and Alto — were crowd pullers, with two of these models available in automatic gear shift, a new technology that is catching up with consumers.

“March sales were very good. Inventory has come down with dealers and with us. April has been a good month, too. People usually advance their purchase to March for different reasons, which makes April sales look bad,” said R C Bhargava, chairman, Maruti Suzuki.

The Delhi-based car maker has been clocking sales in excess of 100,000 vehicles every month, the norm in the months before the industry hit a slowdown. Though Bhargava said sales were looking up, he cautioned about the low base of last year.

South Korean brand Hyundai, the country's second biggest car maker, followed with an increase of 10 per cent in sales during the month. Its top-selling models — Elite i20 and Grand i10 — improved overall sales despite the absence of the Santro, phased out recently.

“In the last few months, there has been positivity in the market but the unseasonal rain may affect rural buying. In addition, the rise in fuel prices may impact customer sentiment,” said Rakesh Srivastava, senior vice-president (sales and marketing), Hyundai Motor India.

Utility vehicle leader Mahindra & Mahindra, which saw sales fall eight per cent last year, posted a one per cent growth in April. Lack of new models had affected M&M’s performance last year as the competition continued launches and refreshments. However, the company managed to regain the third spot last month, displacing Honda Cars India.

“The industry is hopeful of a better financial year as we see positive sentiment and policy and project announcements leading to higher levels of economic activity. We expect to perform better on upcoming launches,” said Pravin Shah, president and chief executive (automotive), M&M.

Riding on demand for the City sedan, now 65 per cent of Honda’s local sales volume, the company notched 14 per cent growth in April sales to 12,636 vehicles, despite a production issue at one of its plants during the month.

Toyota Kirloskar managed to outpace rivals with sales growth of 63 per cent in April. “The growth in sales can be attributed to the growing popularity of our Etios series, especially after the introduction of the Etios Cross last year. The Etios series, along with the new Corolla Altis, has helped us achieve consistent growth month on month,” said N Raja, director and senior vice-president (sales and marketing), Toyota Kirloskar.
 
Toyota announced the launch of new Camry Hybrid, which will be available in the market starting today.