Maruti Suzuki’s assembly line. (Source: Company website)

Autos Sales To End 2018 On A Tepid Note     

Auto sales are likely to remain muted in December due to a slowdown that began during the festive season even as brokerages continue to be sanguine about a recovery in the new year, according to Bloomberg Quint poll of 3 brokerages.

A flat growth in the passenger vehicle segment and a sharp double-digit decline could be seen for the medium and heavy trucks, according to the poll.

  • Maruti Suzuki India Ltd., the country’s largest carmaker, is expected to report a low single-digit sales growth due to a week-long maintenance shutdown in December.
  • Mahindra & Mahindra is also expected to report a tepid growth on the back of a weak demand in utility vehicle sales despite the launch of Marazzo.
  • Tata Motors, too, is likely to see weak sales for its passenger vehicles segment and a sharp decline in the commercial vehicle sales.
  • In the two-wheelers segment, Royal Enfield and Hero MotoCorp are likely to see a single-digit growth, according to the poll.
  • For Bajaj Auto, brokerages expect a strong domestic double-digit growth which would lead to market share gains.

Inventory levels were still high at five-six weeks across segments (normally 4 weeks) at the start of Dec.18, said Kapil Singh, analyst at Nomura. “Given the pressure to clear inventory, discounts have increased and we expect wholesales to be lower than retails to normalise year-end inventory levels."

Channel checks by brokerages like Nomura suggests that the retail demand has improved from the weak levels in early festive season in the month of December.

Here are the key factors according to Nomura that will impact automakers:

Ashok Leyland

  • Higher base coupled with weak demand will lead to a sharp decline in volume growth

Bajaj Auto

  • Strong growth in domestic and export market to drive growth for two-wheeler sales

Eicher Motors

  • Royal Enfield sales growth to be aided by ramp up in production after strike at Chennai plant

Hero MotoCorp

  • Weak retail sales and high inventory to lead to a slower wholesale growth


  • Year-end inventory reduction and slow retail sales to impact December dispatches

M&M Auto

  • Utility Vehicle demand to remain weak despite Marazzo launch

M&M Tractors

  • Slowdown in demand to impact sales

Tata Motors

  • PV segment to report flat growth coupled with decline in CV sales on the back of a weak demand

TVS Motors

  • Healthy momentum to continue across segments especially exports