Auto Sales November 2018: Passenger Vehicle Sales Remain Muted

Passenger Vehicle (PV) sales have been under pressure in the third quarter of Fiscal Year 2018 and various micro and macro-economic factors have added to it. The festive season which generally is the most fulfilling period for carmakers was muted this year as customer sentiments were not positive. During Q3 retail prices of petrol and diesel which were skyrocketing at over Rs. 91 per litre in some of the states like Maharashtra had hounded auto demand further complemented by policy disruptions such as one-time payment of insurance premium and higher interest rates on car loan.

Also Read: Festive Season 2018: Auto Industry Records Sluggish Sales

Having said that, PV sales in November (though negative) was considerably better compared to previous couple of months while the production took a major hit due to inventory accumulation at the dealership level. In November 2018, the PV segment witnessed a drop of 3.43 per cent at 266,000 units against 275,440 units which were sold in the same month last year whereas the production was down by a whopping 20.94 per cent at 279,333 units against 353,339 units.

Passenger cars segment was marginally down by 0.91 per cent at 179,783 units in November 2018 against 181,435 units in the same month previous year while the production of passenger cars witnessed a slump of 22.25 per cent at 187,898 units against 241,655 units. SUV sales plunged significantly by-10.18 per cent at 69,884 units at against 77,807 units in the same period last year while the production went down by 21.82 per cent at 75,817 units against 96,973 units in the same period last year. However, the vans segment posted a nominal growth in sales of 0.83 per cent at 16,333 units against 16,198 units in the same period last year. The production of Vans was up by 6.17 per cent at 15,618 units against 14,711 units in the same period last year.

Citing similar reasons, Sugato Sen, Deputy General Director- Society of Indian Automobile Manufacturers (SIAM) said, "The sales are slowly picking up as the fuel prices are coming down and the impact of other micro-economic factors like one-time payment of loan and interest are getting even." However, Sen was concerning over the production figures which were significantly down due to inventory built-up at dealership level.

Though the sales of two-wheeler segment posted usual numbers as the customer sentiment in small cities and rural area remained positive. The cumulative sales of the two-wheeler segment were up 7.15 per cent at 16,45,791 units against 15,36,015. The growth in the segment was led by motorcycles which grew by 9.36 per cent at 10,49,659 units against 959,860 units in the same period last year. The scooter segment at the same time grew at 3.02 per cent at 521,542 units against 506,267 units last year and mopeds witnessed a growth of 6.73 per cent at 74,590 units against 69,888 units in the same period last year.