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August sales a mixed fare for automobile companies

Posted on Sep 01 2014 | IANS

New Delhi/Chennai, Sep 1 : It was a mixed bag for automobile makers in August with some like Maruti Suzuki, Ashok Leyland and TVS Motors logging overall growth while others are on the reverse gear waiting for the festival season to perk up the sales.

Experts are of the view that the sales growth is more due to sentiments than economic data.

"The spurt in growth seems to be more on account of the prevailing sentiment rather than on hard economic data, at the moment. There may be a tapering off of demand if the economic parameters remain weak in the coming months," Kumar Kandaswami, senior director, Deloitte Touche Tohmatsu India, told IANS.

According to him, if the inflation goes down and if investment begins to flow into the important sectors triggering growth in disposable income, the growth in demand for cars will be sustained.

"The spurt in sale before the festival season will, therefore, be dependent upon the demand drivers improving significantly in a timely manner," he said.

"We maintain a cautious optimism for a good festive season on the strength of new products, increase in demand for petrol cars and improving customer sentiments," said Rakesh Srivastava, senior vice president, sales and marketing, Hyundai Motor India.

"We anticipate a continued revival in customer sentiments as we lead up to the festive season and are prepared to meet the higher demand for our cars, including the popular Ford EcoSport," said Vinay Piparsania, executive director of Marketing, Sales and Service, .

India's largest passenger car manufacturer Maruti Suzuki closed last month with a healthy sales growth of 26.9 percent in total sales, including exports at 110,776 units (domestic 98,304 units, exports 12,472 units).

The company sold 87,323 units (domestic 76,018 units, exports 11,305 units) in August 2013.

Sales in passenger cars segment, which comprises brands like Alto, WagonR, Swift, Ritz, Dzire, Celerio and SX4, were higher by 30.4 percent at 82,823 units sold from an off-take of 63,499 units in the corresponding month of 2013.

The off-take of utility vehicles like Gypsy, Grand Vitara and Ertiga was up by 20.3 percent at 5,491 units from sales of 4,563 units in August 2013.

Sales in van segment that includes brands like Omni and Eeco rocketed by 25.6 percent at 9,990 units from an off-take of 7,956 units in the corresponding month of 2013.

On the other hand, Hyundai Motor India Monday reported an overall fall of eight percent in its sales for August at 48,111 units (domestic 33,750 units, exports 14,361 units) from 52,319 units (domestic 28,311 units, exports 24,008 units) in the corresponding month of last year.

Ford India sold a total of 14,092 vehicles (domestic and exports) - a 27 percent increase from 11,065 units sold in the corresponding period of last year.

While the company's domestic sales went on a reverse gear by 1,207 units to 6,801 units last month, its exports shot up to 7,291 units from 3,057 shipped out in August 2013.

The company is planning for a third shift at its Chennai plant and have cut down the waiting period for models like Ford EcoSport.

However Mahindra and Mahindra (M and M) reported seven percent fall in sales at 35,175 units (domestic 33,145 units, exports 2,030 units) from 37,897 units (domestic 35,159 units, exports 2,738 units) during the period under review.

"In spite of our overall sales remaining flat in August, we continue to be optimistic due to the industry's enhanced business confidence which is reflected by the manufacturing sector showing signs of revival," said Pravin Shah, chief executive, automotive division and international operations, M and M.

Commercial vehicle maker Ashok Leyland Ltd saw an upward swing in its sales at 8,331 units last month from 7,139 units sold in Aug 2013.

Two and three wheeler maker TVS Motor Company closed last month with 46 percent volume growth at 227,482 units (two wheelers 217,662 units, three wheelers 9,820 units) as compared to 155,532 units (two wheelers 148,469 units, three wheelers 7,063 units) sold in Aug 2013.

Another two wheeler maker, Eicher Motors logged 66 percent sales growth at 26,443 units.

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