August Auto Sales: Auto Sales A Mixed Bag In August

Sales of passenger vehicles and two-wheelers in August were impacted due to floods in Kerala and heavy rainfall in other states.

Sales of Maruti Suzuki Ltd., the country’s largest carmaker, fell for the second straight month. It sold 1.58 lakh units last month, down 3.4 percent from the year-ago period, according to its exchange filing. Homegrown Tata Motors was the only company to report a double-digit growth in the passenger vehicles segment in the reporting month. Sales of sports utility vehicle maker Mahindra & Mahindra remained subdued.

Two-wheeler maker Bajaj Auto, however, outpaced rivals in August. The company’s sales rose 30 percent year-on-year last month, according to its exchange filing. That compares with a 0.9 percent rise in sales for the country’s largest two-wheeler maker Hero MotoCorp, and an 8 percent and a 2 percent increase for TVS Motor and Eicher Motors’ Royal Enfield, respectively.

“Bajaj Auto excelled well in the export market,” Ashwin Patil, senior analyst at LKP Securities, told BloombergQuint in an interaction. “The domestic segment also reported healthy growth, driven by new launches.”

Truckmakers continued to grow in August. Most commercial vehicle makers reported double-digit growth last month. “The commercial vehicle makers have grown well, driven by a pick-up in infrastructure activities, ease of mining and healthy monsoon,” Patil said.

Patil expects moderate sales growth in September due to a delayed festive season and high base but anticipates growth to pick up in October and November.

Mahindra & Mahindra Ltd.’s farm equipment's sales rise 7 percent on a yearly basis in August, after it sold 16,641 units during the period, according to its stock exchange notification.

Key sales highlights (YoY):

• Total domestic sales rose 7 percent to 15,356 units.
• Total exports rose 10 percent to 1,285 units.

Shares of M&M fluctuated between gains and losses to trade at Rs 964.60 as if 11:10 a.m.

Bajaj Auto sold 4.37 lakh units last month, an increase of 30 percent from the year-ago period, according to its stock exchange filing. This was the highest ever monthly sales that the company recorded so far, it said.

Key sales highlights (YoY):

• Domestic Motorcycle sales rose 27 percent to 2.18 lakh units.
• Motorcycle exports rose 29 percent to 1.44 lakh units.
• Overall Motorcycle sales rose 28 percent to 3.62 lakh units.
• Domestic commercial vehicle sales rose 28 percent to 37,194 units.
• Commercial vehicle exports rose 67 percent to 36,975 units.
• Overall commercial vehicle sales rose 45 percent to 74,169 units.
• Overall domestic sales rose 27 percent to 2.55 lakh units.
• Overall exports rose 35 percent to 1.8 lakh units.

Hero MotoCorp Ltd. sold 6.85 lakh units last month, an increase of 0.9 percent from the year-ago period, according to its stock exchange filing.

The company plans to launch two new 125 cc scooters during the upcoming festive season and expects to maintain healthy double‐digit growth in coming months.

Eicher Motors Ltd., the maker of Royal Enfield motorcycles, reported largely flat sales in August. Two-wheeler sales grew a paltry 2 percent over last year to 69,377 units.

Key sales highlights (YoY):

• Models with engine capacity up to 350cc saw sales rise 3 percent to 65,712 units.
• Models with engines over 350cc saw a 16 percent decline in sales to 3,665 units.
• Exports grew 23 percent to 1,263 units

TVS Motor Company Ltd. sold 3.43 lakh units in August, an increase of 8 percent from the year-ago month, according to its stock exchange filing.

Key sales highlights (YoY):

• Two-wheeler sales rose 7 percent to 3.3 lakh units.
• Scooter sales rose 11 percent to 1.26 lakh units.
• Three-wheeler sales rose 56 percent to 13,141 units.
• Exports rose 45 percent to 66,028 units.

Tractor maker Escorts Ltd. sold 4,812 tractors in August, an increase of 6.3 percent from the corresponding month previous year, the company said in its regulatory filing.

Key sales highlights (YoY):

• Domestic sales rose 6.3 percent to 4,674 units.
• Exports fell 27 percent to 138 units.

Tata Motors Ltd. sold 58,262 units last month, an increase of 27 percent from the year-ago month, according to its stock exchange notification.

Key sales highlights (YoY)

• Domestic passenger vehicle sales up 28 percent at 18,420 units.
• Domestical commercial vehicle sales up 26 percent at 38,859 units.
• Exports up 78 percent at 5,478 units.

Mahindra and Mahindra Ltd. sold 48,324 units last month, an increase of 14 percent from the sales clocked in August 2017, according to its stock exchange notification.

August sales highlights (YoY):

• Passenger vehicle sales rose 2 percent to 19,758 units.
• Utility vehicles sales fell 2 percent to 17,892 units.
• Commercial vehicles sales rose 25 percent to 20,326 units.
• Medium and heavy commercial vehicle sales rose 113 percent to 1,148 units.
• Three wheeler sales rose 35 percent to 5,289 units.
• Total domestic sales rose 15 percent to 45,373 units.
• Total exports rose 14 percent to 2,951 units.

Ashok Leyland Ltd.’s sales rose 27 percent in August on a yearly basis after it sold 17,386 units, according to its stock exchange filing.

August sales highlights (YoY):

• Sales of medium and heavy commercial vehicles rose 24 percent to 13,158 units.
• Sales of light commercial vehicles rose 38 percent to 4,228 units.

Maruti Suzuki India Ltd.’s sales fell for the second straight month and declined the most in over two years.

The country’s largest automaker sold 1.58 lakh units last month, a decline of 3.4 percent from the year-ago period, according to its exchange filing.

August sales highlights (YoY):

• Sales in mini segment vehicles rose 1.3 percent to 35,895 units.
• Sales in compact segment fell 3.6 percent to 71,364 units.
• Sales in utility vehicles segment fell 16.2 percent to 17,971 units.
• Sales in vans segment fell 1.9 percent to 13,663 units.
• Overall domestic sales fell 2.8 percent to 1.47 lakh units.
• Overall exports fell 10.4 percent to 10,489 units.

August sales were adversely affected due to the floods in Kerala and heavy rains in other parts of the country, the company said in its press release.

(Corrects earlier version which stated the sales declined the most in nearly two years.)

The passenger vehicle sales are expected to witness a setback in August due to delayed festive season and floods in Kerala, according to BloombergQuint’s survey of 30 dealers across the country.

The car sales in the previous month are expected to be subdued due to increase in commodity prices and rupee depreciation, according to the survey.

Among the two-wheeler makers, the country's largest firm by market value – Hero MotoCorp Ltd. is expected to be impacted by the increased competition in the entry-level segment. Bajaj Auto Ltd.'s sales are expected to rise on the back of weak performance in the same month last year and aggressive pricing in the entry-level segment.

TVS Motor Company Ltd. and Eicher Motors Ltd.'s Royal Enfield are expected to witness an impact in volumes on weak Onam sales due to Kerala floods.

Truck Sales Growth Momentum To Continue

The truck sales are expected to grow in August, cushioning the overall sales of Tata Motors Ltd. and Mahindra & Mahindra Ltd. from the slowdown in passenger vehicle sales.