PV sales dip in December, see fifth monthly decline since July

New Delhi: Domestic passenger vehicle sales declined in December 2018 for the fifth time in the past six months, as manufacturers reduced wholesale dispatches to dealers in order to cut inventory pile-up after a tepid festive season.

According to the latest data released by the Society of Indian Automobile Manufacturers (Siam) on Monday, passenger vehicle (PV) sales in December stood at 2,38,692 units, marginally down from 2,39,723 units in December 2017.

Similarly, domestic car sales declined 2.01 percent to 1,55,159 units, compared with 1,58,338 in December 2017.

PV sales declined by 3.43 percent in November 2018. It rose 1.55 percent in October, snapping three months of consecutive decline. In July, August and September, PV sales fell by 2.71 percent, 2.46 percent and 5.61 percent, respectively.

"As festive season selling did not happen this year (2018) around, stocks at dealer level went up considerably. It required a correction so automakers made adjustments in this regard during December," Siam President Rajan Wadhera told reporters here.

With reduced dispatches and brisk retail sales during the month, the situation is now normal with inventory levels reduced to 30-35 days from the earlier levels of 45-50 days, he added.

Issues like high fuel prices, lack of finance and credit options led to decline in sales in the third quarter, Wadhera said.

"With fuel prices coming down, buyer sentiments have now started to turn positive and we expect the fourth quarter to be better in terms of sales," Wadhera said, adding that 2019 is going to be a "year of growth".

"As we move towards BS-VI emission norms from 2020, we expect to see pre-buying happening this year. It happens all over the world," he noted.

Wadhera said two-wheeler prices are set to go up after transition to BS VI norms.

In 2018, PV sales rose 5.08 percent to 33,94,756 units, from 32,30,614 units in 2017.

During December, market leader Maruti Suzuki India posted a 1.5 percent increase in PV sales at 1,19,804 units. Rival Hyundai Motor India also reported an increase of 4.82 percent at 42,093 units.

Homegrown utility vehicle major Mahindra & Mahindra reported a 2.83 percent decline in its PV sales at 15,091 units in December. Tata Motors saw sales dip 4.31 percent to 15,395 units during the month.

Siam said total two-wheeler sales in December declined 2.23 percent to 12,59,026 units, compared with 12,87,766 units in the year-ago month.

Motorcycle sales last month, however, rose marginally to 7,93,061 units, against 7,88,334 units a year ago. Scooter sales declined 6.08 percent to 4,06,137 units, compared with 4,32,427 units in December 2017.

During the month, market leader Hero MotoCorp saw its bike sales grow marginally to 4,00,710 units. Rival Bajaj Auto also witnessed a 39.24 percent jump to 1,57,252 units, while Honda Motorcycle and Scooter India (HMSI) saw motorcycle sales dip 25.42 percent to 92,784 units.

In scooter segment, market leader HMSI's scooter sales were at 2,15,212 units in December, down 9.88 percent as compared to the previous year.

Chennai-based TVS Motor Co posted an 8.51 percent jump in its scooter sales at 86,963 units, while Hero MotoCorp witnessed a decline of 37.11 percent at 35,881 units in December 2018.

Sales of commercial vehicles were down 7.8 percent to 75,984 units in December, Siam said. Vehicle sales across categories registered a decline of 2.97 percent to 16,17,356 units from 16,66,878 units in December 2017, it added.