2 May 2009,
NEW DELHI / MUMBAI:
Car and two-wheeler sales saw the fifth straight month of growth in April, buttressing evidence that the recovery was no flash in the pan and providing increasingly rare good news for a sector reeling under the threat of global bankruptcies.
Last month saw market leaders such as Maruti Suzuki, Hyundai Motors, Mahindra & Mahindra and Honda Seil better their performance over the corresponding month of the previous year, helped by the governments stimulus packages, cuts in lending rates and as elections boosted demand for vehicles, especially jeeps and SUVs.
The sentiment has improved and the Nano is likely to give a fresh lease to auto sales. But demand in the coming months will be determined by the policies of the new government, said Abdul Majeed, analyst with PriceWaterhouse.
Maruti Suzuki, which makes every second car sold in India did particularly well, with a 9% year-on-year growth in April, while close competitor Hyundai Motors sold 4% more this year.
Mahindra & Mahindra (M&M), with its array of SUVs and mini-trucks, saw sales jump 36%, as elections boosted demand for its products tailor-made for the rough terrain of rural India.
Surging rural demand also helped two-wheeler maker Hero Honda post a 29% increase in sales. The company, Indias and also the worlds largest two-wheeler maker, sold 3.70 lakh units in April, up 29% year-on-year. Hero Hondas senior vice president for sales and marketing Anil Dua said he expected the trend to continue in the coming months.
Its competitor Yamaha Motors India sold posted a 48% increase in sales to 15,120 units, thanks to high demand for its 150-cc bikes, while TVS Motors sales rose 3% to 1.13 lakh units, with light scooters driving demand in small cities and towns.
Among car makers, Marutis success was mainly centered on its best-selling sedans SX4 and Dzire. The elections boosted demand for its utility vehicles Gypsy and Grand Vitara, with their sales jumping 10-fold to 905 vehicles in April.
According to Marutis executive officer for marketing & sales Mayank Pareek, the company, on an average, has gained 11% in sales in the past four months. Sales will rise further once Marutis premium hatchback Ritz is launched, he said.
Two auto analysts ET spoke to said new launches such as Ritz, Hondas premium hatchback Jazz and Fiats mid-sized hatchback Grande Punto will fuel auto growth further this year.
Honda Siel Cars India (HSCI) posted a 7.5% increase in sales to 3,656 cars during April.
M&M, which saw its sales double in April from the monthly average of 10,000 units in the past fiscal year, attributed it directly to the election demand. The companys chief of operations for automotive sector, Rajesh Jejurikar, said M&Ms recently-launched Xylo posted its highest monthly sales of 3,509 units in April. But its sedan Logan continued to perform poorly, with sales more than halving to 550 cars.