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The slowdown in the auto sector is gravely affecting manufacturers and Tata Motors is the latest OEM to announce a massive decline in volumes. The company registered a drop of 58 per cent in domestic passenger vehicle sales for August 2019 with 7316 units as opposed to 18,420 units sold in August last year. The company's total sales (domestic + exports) for last month stood at 32,343 units, a decline of 48 per cent in volumes over 62,688 units sold during the same month last year. Tata Motors reported one of its lowest sales in nearly two decades.
Speaking on the PV sales report for August 2019, Mayank Pareek, President, Passenger Vehicles Business Unit, Tata Motors said, "Under the challenging market situation, we continued to focus on improving retail sales. Our retail sales were 42% more than offtake and as a result the network stock came down by over 3000 vehicles. This prepares dealers well for the festival season. Our prime focus remains on the working capital rotation of the channel. Our aim is to improve the retail capability, till August 2019, 72 new sales outlets were added and 3500+ sales executives were recruited.
"Marking the onset of the festive season, we will drive positive sentiments with special offers and several special editions. We have kick-started this by further increasing the style quotient of the Harrier with the Harrier Dark Edition. We are hopeful that the recently announced financial package by finance minister will help in improving the liquidity of market and to reduce the ownership cost. This will certainly help the industry to revive and drive the growth," he added further.
In the commercial vehicle segment, Tata Motors registered a negative growth across all categories. The Medium & Heavy Vehicles Segment saw the company sell 5340 units in August 2019, a drop of 58 per cent over 12,715 units sold during the same month last year. The I&LCV segment too registered a 40 per cent dip in volumes with 3152 units sold last month, as against 5260 units sold in August 2018. Sales in the SCV and pick-up categories stood at 11,082 units, down by 36 per cent, as against 17,426 units sold during the same period last year.
Lastly, the passenger carriers from Tata Motors saw a 50 per cent reduction in volumes with 2250 units sold in August 2019, over 4458 units sold in August last year. Cumulatively, Tata's CV sales stood at 21,824 units last month, declining by 45 per cent over 39,859 units sold a year ago.
Speaking on the CV sales report, Girish Wagh, President, Commercial Vehicles Business Unit, Tata Motors said, "Subdued demand sentiment due to poor freight availability, lower freight rates and general slowdown in economy continued to hamper the commercial vehicle demand. System stock reduction through retail focus and aligning production, will continue to be our approach, while cautiously monitoring the market, in these challenging times. As a result, retail sales are estimated to be ahead of wholesale by over 25 per cent in August. We are looking forward to a positive impact of the recently announced stimulus package by the Government."
Automakers including Tata Motors are now counting on a positive festive season and a stimulus package from the government to act as catalysts for the auto sector. The consumer buying sentiment is expected to finally pick up with the advent of the festive season, while OEMs are requesting the government to grant a temporary reduction in GST rates, as a short in the arm for the auto sector. The Finance Minister recently announced a number of measures for the auto industry in a bid to revive sales in the sector.
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