Petrol Stop - Auto firms cruise through August on back of domestic sales, exports

Auto firms cruise through August on back of domestic sales, exports

Tuesday, 01 September 2009

02 Sept 2009:business-standard.com:New Delhi: Buoyant exports and brisk sales in the domestic market have helped car manufacturers — led by Maruti Suzuki, Hyundai and Mahindra & Mahindra — to post a growth in domestic sales for the month of August this year. This is a continuation of the robust sales witnessed in July, when the total passenger vehicle industry grew by around 10 per cent. Maruti Suzuki’s domestic sales last month grew by an impressive 29 per cent, compared with the sales achieved in August last year. Maruti, which commands a share of over 50 per cent in the domestic market, sold a record 69,961 vehicles, which is the highest volume achieved for the current financial year. In July, the car manufacturer’s domestic sales grew by around 28 per cent. Maruti’s exports, largely comprising the A-Star — its fifth strategic model to key European markets — grew by a staggering 156 per cent. In August, the company exported 14,847 units of cars. A Mumbai-based analyst said the company’s sales had come primarily from the good demand witnessed for the A-Star model (which sells around 3,000 units per month) launched last year and the Ritz (6,000 units) which was introduced in the domestic market this year. “The other key factor which contributed to last month’s robust sales is the car loans made by PSU banks, like SBI, which begin at a rate of 8 per cent,” a Maruti executive said. According to the company’s CEO and MD Shinzo Nakanishi, the company expects domestic sales to grow by around 10 per cent for the whole of the current year. At the beginning of the year, the company’s domestic sales growth was pegged at around 5 per cent. Hyundai, the second-largest player, sold 24,401 units of cars in the domestic market, which is 13 per cent higher than the August sales of last year. The company exported 25,120 units of cars in August, which is a growth of 9 per cent. “We are now entering the festival season phase and strong sales would help the industry return to a healthy growth,” Hyundai Motor India Ltd Senior Vice-President (marketing & sales) Arvind Saxena said. However, going forward, Saxena said sales of cars could get impacted if interest rates begin to rise and if inadequate monsoons dampen rural sales. Mahindra & Mahindra’s August sales grew by 42 per cent, largely due to the brisk demand for its utility vehicle, Xylo, which was launched this year. The company sold 16,631 vehicles in August this year, against the 11,731 units sold last year. Mahindra Renault’s sales for August dipped by 68 per cent. The company sold 469 units of Logan cars during the month. Honda Siel sold 4,102 cars last month, which is a 4 per cent growth over last year. The company sold 1,029 units of the premium A2 compact car Jazz, which was launched this year. Company officials said there was good demand for this premium model. Skoda Auto India posted a 33 per cent growth in domestic sales, selling 1,463 units of cars. The company says it continues to witness brisk demand for its premium model, the Skoda Superb, and executive models like the Octavia and Laura. August sales for Tata Motors grew by 11.32 per cent, with the company selling 17,364 units of the Nano, Indica, Indigo and utility vehicles like the Safari. The company sold 2,501 units of Nano last month. Sales of the company’s commercial vehicles (CVs) grew by 28 per cent mainly on account of better demand for its stable of light commercial vehicles. Total number of CVs sold for August 2009 stood at 29,762 units. One notable feature in the company’s August sales is the positive sales growth witnessed in the medium and heavy commercial vehicles segment, which witnessed a growth of 10 per cent with the sale of 11,118 units of trucks. This is the second month, after July, that this segment has witnessed a positive growth. However, total exports, comprising passenger and commercial vehicles for Tata Motors in August, dipped by 44 per cent to 2,684 units.