Car Sales January 2017: Maruti Suzuki Grows By 25%, Honda's Drop By 10%

We are a month into the New Year and with the 2017 Union Budget announcement slated for today, there is a lot of anticipation from the auto sector. While auto manufacturers in India are keeping an optimistic approach towards the Budget, vehicle sales in January 2017 are also something we are looking forward to. While vehicle sales in December 2016 had quite an impact due to demonetisation, especially for Maruti Suzuki and Mahindra, this month the country's leading carmaker Maruti Suzuki India has announced 27 per cent growth in overall sales. Maruti Suzuki sold 144396 vehicles in January 2017 compared to the 113606 units sold during the same time last year.

Maruti Suzuki Vitara Brezza

The company's sales report reveals substantial growth in both domestic sales and exports. Last month Maruti Suzuki sold a total of 1,33,934 vehicles in the domestic market registering 25 per cent increase in sales compared to the 1,06,383 vehicles sold in January 2016. Exports, on the other hand, saw a growth of 44.8 per cent with 10,462 units being sold in January 2017 compared to the 7223 units sold during the same period last year.

While Maruti Suzuki's top players Alto, Swift hatchback, Swift Dzire and WagonR have played their part in adding to the domestic growth, it's the company new subcompact SUV Vitara Brezza and premium hatch Baleno, which have to be credited for a major chunk of the increased sales numbers. In fact, the carmaker has posted a 101 per cent growth in utility vehicle segment compared to sales in January 2016, which includes the Vitara Brezza, S-Cross, Ertiga and the Gypsy. That said the point to be noted here is that the Vitara Brezza was only launched in March 2016, so it's understandable why Maruti's sales in utility vehicle space grew over two folds this year. We might not see similar growth after March 2017, though.

Considering the new Maruti Suzuki Ignis was launched in India towards the end of January 2017, the car hasn't been included in last month's sales figures. That said considering the demand and bookings that the Ignis has received so far, we expect the company's sales in the compact space to grow further from the current month.

2017 Nissan Sunny

Meanwhile, Nissan Motor India registered sales of 4346 units in January 2017 as against 2668 units sold in the same month last year. Nissan and its sub-brand Datsun together recorded a 63 per cent year-on-year growth, owing to the positive response of the new Datsun redi-GO that was introduced last year.

Commenting on the sales results, Arun Malhotra, Managing Director, Nissan Motor India said, "We have started the new year on a positive note. Despite the challenging market conditions, we have seen a substantial year-on-year growth in January which signifies strong customers' response and trust in the Nissan and Datsun brands. We see that translated into making the Nissan Group the second fastest growing car brand in India, coupled with the strong sales performances of the Datsun redi-GO, Nissan Micra and the newly-launched New Sunny 2017."

While the Datsun brand has finally gained some momentum given the redi-GO's success, Nissan is yet to find base despite a diverse product portfolio. The previous month saw the company introduced the 2017 Nissan Sunny sedan in the country with subtle upgrades over the older version priced at Rs. 7.91 lakh (ex-showroom, Delhi). The company plans to introduce the all-new XTrail Hybrid in India this year that will take on the Honda CR-V, Hyundai Santa Fe and the likes, and will act as a brand builder for the company.

Hyundai Tucson

Adding to the list of positive sales in January 2017, Hyundai India managed to sell 42,017 in the previous month in the domestic market, growing by 10.5 per cent over the previous year. The company's exports stood at 9817 units in January, growing by a healthy 58 per cent over the same period last year. Cumulatively, the Korean car maker saw a growth of 17.2 per cent in the past month.

Hyundai India has grown immensely on the success of its existing range comprising the Grand i10, Xcent, Creta, i20 and the likes. The automaker's recently launched Tucson has also managed to garner positive numbers ever since its arrival.

Commenting on the sales for the first month of the year, Hyundai India, Senior Vice President - Sales and Marketing, Rakesh Srivastava said, "Year 2017 looks promising with entire industry optimistically looking forward for a positive growth. Hyundai has shown all model growth of 17.2% on account of good performance by super performer brands Grand i10, Elite i20, Creta and without any new mass model launches. The Union budget will give boost to economy especially rural with focus on infrastructure creating a robust business environment thus helping auto industry and positively contribute to National GDP."

Honda Accord

Sales weren't optimistic for Honda Cars India (HCIL) this January as the company registered a de-growth of nearly 10 per cent year-on-year. The company recorded domestic sales of 15,592 units, while exports stood at 982 units last month. The Japanese carmaker attributed its negative growth to the demonetisation drive that as announced the in November last year and seems to show its effect on the manufacturer.

In a statement, Honda India, President and CEO, Yoichiro Ueno said, "HCIL sales results recovered this month as the consumer sentiment and currency situation has started improving gradually. We hope the situation normalises and market recovers quickly."

Nevertheless, Honda is expected to recover slumping sales this year with the slew of launches planned in the coming months. The automaker has the much awaited City facelift lined up for launch on 14th February, while the Jazz-based crossover - WR-V has commenced production and is slated for launch in March this year.

Mahindra TUV300

Demonetisation seems to have also affected Indian manufacturers Mahindra and Tata Motors. The former posted a sales record of 39,303 vehicles in January 2017, a drop of 3 per cent when compared to 43,789 vehicles sold in January 2016.

Sales for Mahindra dropped in all segments last month with the passenger vehicle space retailing 20,096 units, down by 9 per cent, as opposed to 22,088 units sold during the same period last year. Meanwhile, the utility vehicle (UV) segment recorded sales of 19,217 units in January, downy by 9 per cent over last year. The commercial vehicle segment too saw numbers drop for Mahindra as the company sold 13,890 units, de-growing by 3 per cent, year-on-year. The company's exports for January 2017 stood at 2261 vehicles.

With a healthy part of Mahindra's sales contributed by tier II and III markets, the demonetisation effect can be seen on the overall sales figures. Speaking on January sales, Mahindra President and Chief Executive (Automotive), Pravin Shah said, "The auto industry continues to see mixed reactions and some of the segments including the rural market and the commercial vehicles category continue to face challenging times. Going forward we expect the announcements made at the National Budget will positively impact the economy and also the industry, especially in view of the emphasis and the allocations made for rural, agri and infrastructure. We are confident that this will lead to a spur in demand".

Tata Tiago

After reassuring 2016, Tata Motors saw a mild dip in volumes in January 2017, having recorded total sales of 46,349 vehicles last month. The company witnessed a 1 per cent drop in numbers over January 2016, but the individual segments continued to post positive growth. The passenger cars segment grew by a healthy 21 per cent last month backed by the strong demand of the Tiago, while the Hexa crossover went on sale last month.

Commercial vehicle sales though dropped by 7 per cent in January, standing at 28,521 units; whereas exports too dropped by 13 per cent with 4921 vehicles shipped out last month. That said, Tata Motors largely has had a positive fiscal and the company is expected to end FY2017 on a positive note.