During February, while weakness persisted across most segments, it was more prominent in MHCV, tractor, passenger car, and two-wheeler segments. The UV segment, which had so far remained insulated from the slowdown, also witnessed initial signs of weakness
Automobile sales during February 2013 continued to suffer from extreme weakness, with utility vehicles (UVs) and sports utility vehicles (SUVs), the only segment that was growing, too taking a hit. During the month auto sales remained weak across most segments, led by continued weakness in domestic demand on account of high interest rates, inflation and slowdown in economic activity. High base effect due to pre-budget buying in February 2012 also impacted the growth.
“The decline in car sales in February was the biggest since December 2000, when sales declined by 39.86%. The market continues to be extremely difficult as high fuel prices, interest rates and overall macro economic factors are adding to low consumer sentiments,” Sugato Sen, deputy director general of Society of Indian Automobile Manufacturers (SIAM) told reporters in New Delhi.
According to the data released by the SIAM, during February, overall sales fell by 5.45% to 14.51 lakh units from 15.34 lakh units same month last year. Domestic passenger car sales fell 25.71% to 1.58 lakh units compared with 2.13 lakh units same month of 2012 taking the total passenger vehicle sales 16.67% down.
The automobile sector has witnessed a shift in demand in almost all the segment of vehicles. In the passenger vehicles segment, the gradual shift towards UVs against cars is evident as they are powered by cheaper fuel and have space to accommodate more people. UVs’ contribution in the total sales of passenger vehicles has increased to 20% from 14% last year.
While weakness persisted across most segments, it was more prominent in the medium and heavy commercial vehicle (MHCV), tractor, passenger car, and two-wheeler segments. The UV segment, which had so far remained insulated from the slowdown, also witnessed initial signs of weakness.
Maruti Suzuki India’s UV sales declined 2% mom (month-on-month). While passenger vehicle sales for Mahindra & Mahindra (M&M) grew 14% during February, Tata Motors’ domestic UV sales and car sales tumbled 57% and 73% to 2,844 units and 7,769 units, respectively, compared with a year-ago period.
Post Union Budget, both M&M and Tata Motors have increased prices of their SUVs in line with the increase in excise duty, which may impact sales for the only segment that was witnessing growth in automobile industry.
During the month, total sales of commercial vehicles declined by 11.1% to 68,388 units from 76,891 units in the year-ago period. In February, M&HCVs sales tumbled 34.72% due to hike in diesel prices and slow down in industrial activities.
Total two-wheeler sales in February 2013 slipped by 2.77% to 11.12 lakh units from 11.43 lakh units in the same period last year. Motorcycle sales during the month fell 4.48% to 8.00 lakh units from 8.37 lakh a year ago period, SIAM said.
In this segment, there is gradual rise (2.55%) in the sales of scooters over motorcycles. Scooters contribute around 21% in the total sales of two-wheelers, an increase of 3 percentage points from last year. Honda is a leader in scooters which is impacting sales of Hero MotoCorp and TVS Motors.
“Going ahead, we expect the demand environment to remain weak in fourth quarter of FY13 as a slowdown in economic growth coupled with higher interest rates and fuel expenses continue to dampen consumer sentiments,” said one brokerage in a research note.
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My experience:
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Fiat showroom at SV Road, Kandivali – This one is just 5 minutes from my house …….. Closed on Sunday evening… very strange….Entered a request on their website for a test drive..... no response .....
Honda showroom – I reached there at 1830 … Linkway Honda near Infinity Mall, Malad …. They were closing down the showroom……… the salesman shouting at the watchman to not let people in …. Managed to get in the showroom …. Cars crammed in a small space…. Could not even open the doors of the car….. nobody interested … salesman just keep watching us as if they are being nice by not kicking us out…… not even an attempt to sell the car……. Do I look so poor?...... asked the price … was told the sticker price and also the fact that it is not negotiable……. Is it typical arrogance of Honda dealers? .... I also inquired about Honda Jazz ... dealer says that they have stopped manufacturing it for the last 6 months.... I tell them that the Honda website still shows Jazz as available..... my sister calls up Honda customer helpline.... the executive says he has no idea about availability of Jazz...... ask dealers.... after calling another dealer, we got the same response.... my sister called up the Honda customer helpline again... the executive at the other end chided my sister for calling up again for the same problem.... sounded irritated... that takes the cake for customer support......
Tata showroom – this is near Bikaji… Conconrde Motors …… wanted to have a look at the Linea …. The guys said Linea available only at Prabhadevi showroom….. again the salesman just keep looking at us…….. no attempt to sell the car…….. I started looking at the Club class Manza…. Very spacious …. Has all goodies…….. everyone in family likes it……. It is diesel… I ask if Petrol is available… the sales man says no….. petrol is not manufactured now a days !!!!!!! .. he thinks I am a fool in addition to being poor…… I ask the price … he tells me the sticker price … price not negotiable…….. by then the salesman seems to be interested ….. shows us the Limited edition nano……. To be honest… it is a very spacious car…… it has ac, music system, alloy wheels ……. 20 kmpl….. very easy to get in the car… mom likes it very much…… salesman says only 2.46 lakhs all inclusive………. Mom very very happy……… then he shows me Indica Vista …. This is the first time I am seeing a salesman trying to sell a cheaper car when the customer is looking for a more expensive car…. Either he is very honest or I don’t look like a person who will buy a big car……… as a consolation… took my contact number and said someone from Prabhadevi showroom will call for the Linea testdrive…… no call yet…….
Maruti showroom – Shivam Maruti ... SV Road, Kandivali …… I tell them I want to buy Swift or SX4 ……..show room guys ask me to wait.. salesman comes…… opens his laptop …. Shows me a PPT of the new version of SX4…… I think even I can watch a PPT at home……. Sleepwalks through the presentation …….. tells me the price……. Again … it is not negotiable….. car will have to be booked…. No car in stock……… Swift petrol waiting period of 2 months….
Somethings I don’t understand …..
The papers are shouting aloud that car makers are not able to sell their cars……. Here is a person who is looking to buy a car……. Sedan… even willing to pay cash in case of a good deal…… and these guys are just not bothered to sell to a confirmed buyer….. price not negotiable…….
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