As the new fiscal year commenced, the domestic passenger vehicle (PV) sales in India demonstrably began the period with a moderate start. The estimated sales amounted to 338,341 units, which only marked a slight rise of 1.76 per cent compared to the sales figures recorded in the same period of the previous year. This modest growth has been largely ascribed to two main factors: the high base effect and the dampened demand stemming from the ongoing Lok Sabha elections.
The observations from industry executives suggest that the electorate’s focus during the election period has somewhat steered away from expending on vehicles, a pattern that has subsequently reflected in the recorded sales. The largest PV manufacturer in India, Maruti Suzuki India, revealed their domestic market sales to be virtually stagnant, at 137,952 units—showing a negligible variation from last year’s count of 137,320 units. Hyundai Motor India, not far behind as the second-largest manufacturer, also experienced a similar trend with a minute growth of just 1 per cent in domestic sales tallying up to 50,201 units. Furthermore, Tata Motors reported a minimal increase of 2 per cent in their total domestic PV sales, which includes electric vehicles, recording sales at 47,883 units.
In elucidating the situation, Maruti Suzuki’s Senior Executive Officer for Marketing & Sales, Partho Banerjee commented, “We have started on a very high base this year…Right now, the country is going through elections, and there is a model code of conduct… During the elections, the markets are a little muted.” He expressed optimism about the post-election period, stating, “Once elections are over, I think we will be seeing a different market.”
Echoing this sentiment, Hyundai Motor India’s Chief Operating Officer, Tarun Garg pointed out that the PV industry’s growth seen in April is what was projected at the outset of 2024, anticipated to be overall low single-digit growth. According to him, this trend is attributable more to the previous two years’ high base effect rather than a significant market slowdown. He also revealed that the levels of inquiries and bookings were consistent with those seen in the previous year, suggesting sustained consumer interest.
Improvements in the supply chain have been a silver lining, according to Garg, as they translated to a reduced backlog of orders throughout the PV industry. Furthermore, the forecast of a normal monsoon is encouraging news, particularly from the standpoint of rural sales. The continued development of road infrastructure and the increasing aspirations among rural consumers are also likely to underpin sales in this segment.
Amidst the overall subdued PV sales landscape, Toyota Kirloskar Motor stood out with its total wholesales surging by 32 per cent year-on-year to 20,494 units. “We believe that this stable performance underlines a strong foundation for another positive year,” stated Toyota Kirloskar Motor’s Vice-President of Sales-Service-Used Car Business, Sabari Manohar.
Despite this, not all firms enjoyed a boost in sales; MG Motor India reported a slight decrease in retail sales by 1.45 per cent, amounting to 4,485 units.
Switching focus to the two-wheeler segment, the numbers bring a refreshing contrast with TVS Motor Company registering a robust 29 per cent growth in the domestic market, selling 301,449 units. Hero MotoCorp recorded an even more significant 33 per cent growth, with sales at 513,296 units. The mid-sized motorcycle brand, Royal Enfield, also reported a healthy 9 per cent increase in domestic sales, totaling 75,038 units.
These figures from the two-wheeler segment contribute a reassuring undertone to the automotive market dynamics, providing a glimmer of hope for an upswing post the election period. The industry at large remains cautiously optimistic, looking forward to a resurgence in consumer spending and a potential uptick in the vehicle sales trajectory in the months to come.
