With Reports of Gloomy Sales Numbers, Auto Industry Woes Continue in July

Maruti Suzuki's domestic sales drop in July was its largest in over a decade, while Bajaj Auto and M&M also reported poor numbers.

New Delhi: Most of India’s automobile and vehicle companies reported sharp drops in sales in July 2019, continuing a slump that has gone on for a large part of this year.  

Maruti Suzuki, India’s biggest car maker, registered its biggest sales drop yet in 2019, with the company’s domestic sales and exports dropping 33.5% to 1,09 lakh units in July 2019 compared with 1.06 units in the same month last year.

This is the sixth straight month of declining sales for the firm. The automaker also reported a 36.3% year-on-year drop in just domestic sales at 98,210 units in July 2019 compared to 1.54 lakh units in July 2018 – the sharpest decline in over a decade. 

Also read: Auto Slowdown: 286 Dealers Closed Down in 18 Months, 32,000 Jobs Impacted

According to a stock exchange notification put out by the company on Thursday afternoon, sales of mini cars comprising Alto and WagonR were at 11,577 units as compared to 37,710 units in July last year, down 69.3%.

Sales in the compact segment, including models such as Swift, Celerio, Ignis, Baleno and Dzire, were down 22.7% at 57,512 units as against 74,373 units in July last year.

Mid-sized sedan Ciaz sold 2,397 units as compared to 48 units in the same month a year ago.

Utility vehicles, including Vitara Brezza, S-Cross and Ertiga were down 38.1 per cent at 15,178 units as compared to 24,505 in the year-ago month, MSI said.

Exports in July were down by 9.4% at 9,258 units as against 10,219 units in the corresponding month last year, the company said.

M&M, Bajaj Auto too down

Mahindra & Mahindra Ltd.’s auto sales declined 15% to 40,142 units on a yearly basis last month, while its tractor sales fell 12% to 19,992 units, according to its stock exchange filing.

Bajaj Auto, on the other hand, reported its first fall in total sales in nearly two years. The company’s sales, which includes both two-wheelers and three-wheelers, fell 5% to 3.81 lakh units in July 2017, from 4 lakh units in July 2018.

Domestic sales stood at 2,05,470 units as against 2,37,511 units a year ago, down 13 percent, the Pune-based firm said in a statement.

Commercial vehicle sales any better?

The slowdown, which has affected passenger vehicle sales, also appears to have extended to commercial vehicle sales which includes trucks.

For instance, Ashok Leyland’s sales fell 28% on a yearly basis to 10,927 units in July 2018. Sales of domestic medium and heavy commercial trucks fell 47% to 4,668 units.

Also read: Passenger Vehicle Sales Down by 18% in June, Car Sales Decline by 25%

Eicher’s commercial vehicle arm also reported poor numbers, with total sales declining 32.1% on a year-on-year basis to 4,048 units.

According to data collated by Bloomberg, vehicle registrations, a key metric of sales at the dealership level, fell by 1.8% in July 2019 on a month-on-month basis and 8.2% on a yearly basis.

(With inputs from agencies)