India’s domestic auto demand continued to drop in December

India’s domestic automobile sales continued to decline in December with the overall sectoral off-take plunging 13.08 per cent on a year-on-year basis, a data showed.

As per the data furnished by the Society of Indian Automobile Manufacturers (SIAM), the sector’s total sales declined to 14,05,776 units in December from 16,17,398 units sold during the corresponding month of the previous year.

In terms of the calendar year, the 2019 sales decline is the worst ever in the last 20 years.

The off-take of commercial vehicles took a major hit with sales declining 12.32 per cent to 66,622 units, compared to 75,984 units in December 2018.

Medium and Heavy Commercial vehicles were a major victim of the ongoing slowdown as sales fell 31.70 per cent to 31,314 units.

Shamsher Dewan, Vice President, Corporate Sector ratings, ICRA, said: “During December 2019, the focus by CV OEMs continued to be on paring down inventory levels at dealerships, especially for the Goods Carrier segment, considering the impending transition to BS-VI emission norms within a quarter and dealer inventory of more than a month.”

He said that wholesale dispatches of Medium and Heavy Commercial Vehicles and light commercial vehicles contracted by 43 per cent and 1 per cent on a YoY basis.  Wholesale dispatches of the bus segment, on the other hand, has been improving over the past quarter, Dewan added.

Passenger vehicle sales declined by 1.24 per cent during the month on a year-on-year basis to 2,38,753 units. Two-wheeler sales were recorded at 1,259,007 units, lower by 16.60 per cent for a year ago period.

“Robust growth (30 per cent YoY) in the UV segment, supported by new launches like Hyundai Venue, Renault Triber, Kia Seltos and MG Hector arrested PV wholesale decline to 1.2 per cent. Retail enquiries are showing some signs of recovery, which augurs well for the industry,” said Ashish Modani, Vice President, Corporate Sector ratings, ICRA.

“Exports witnessed growth of 9.9 per cent to 66,073 units, mainly due to incremental contribution of 6,341 units by Kia Motors, which otherwise could be flattish,” he said.

However, bucking the larger trend, sales in the three-wheeler segment, which includes both goods and passenger carriers, rose by 22.10 per cent to 43,650 units in December 2019.

Overall exports too witnessed a dip of 8.75 per cent at 3,77,472 units last month.

On the production front, total production last moth stood at 19,16,213 units, lower by 5.22 per cent. Manufacturing of commercial vehicles stood at 62,021 units, lower by 9.76 per cent on a year-on-year basis.

A total of 2,58,391 passenger vehicles were produced in the country in December 2019, 3.11 per cent lower than 2,66,686 units during the same month in 2019.

Meanwhile, Tata Motors did not even produce a single unit of its entry-level offering, Nano, during 2019, while it managed to sell just one unit during the year.

According to data collated from regulatory filings, the company did not produce a single Nano from January-December 2019, while it had rolled-out 516 units during 2018.

The data showed that only one unit was sold during the entire year in February 2019, while 518 were sold during 2018. Export-wise, no Nano was shipped out during the January-December 2019 period.

Asked about the future of the car, a Tata Motors spokesperson said: “The Nano in its current form will not meet the new safety and emission norms and may need infusion of fresh investments.” “No decision has been made yet in this regard.”

The vehicle was launched in 2008. It was dubbed as the people’s car and the world’s cheapest car.

Tata Motors’ UK-based subsidiary Jaguar Land Rover (JLR) on Friday reported a 6 per cent decline in retail sales last year as compared to 2018. The luxury car maker, however, logged a 1.3 per cent increase in retail sales for December 2019 over the previous year.

JLR’s retail sales stood at 557,706, down 5.9 per cent compared to 2018 owing to “challenging industry conditions across markets”. Its sales were down 1.7 per cent in UK, 13.5 per cent in China, 4.9 per cent in Europe and 14.2 per cent in overseas regions, Tata Motors said in a regulatory filing.

The company said that the double-digit sales growth in China over the last six months has been encouraging, as has been the record sales achieved in North America, up 1.8 per cent.

“Following a record 2018, Jaguar sales were down in 2019. In increasingly challenging market conditions, we chose not to weaken the iconic Jaguar brand through chasing volume at any cost,” said Felix Brautigam, its Chief Commercial Officer.

Indo-Asian News Service