The Hindu Business Line : Bike, heavy commercial vehicle sales continue to dip

New Delhi, Feb 8 Despite less than two months left for fiscal 2007-08 to end, the domestic automobile industry is not showing any upswing as most segments continue to post negative growth. January was one of the slowest month in terms of growth for the passenger vehicles industry as the largest player, Maruti Suzuki grew marginally leading to the overall segment shrink.

The motorcycles market too recorded a sharp fall as banks refrained from providing credit on account of high default rates and stricter guidelines on recovery imposed by the RBI.

Bike sales dip

According to the monthly sales data compiled by the Society of Indian Automobile Manufacturers, motorcycles sales fell by 14 per cent in January this year as compared to the same month last year. Hero Honda at 2,80,663 units posted a two per cent decline in sales as against Bajaj, the second largest bike maker whose sales declined by 21 per cent at 1,34,704 units. TVS also witnessed a massive fall of 56 per cent in domestic sales at 27,697 units.

“January is one of the slowest month for the passenger car industry as Maruti posted the lowest growth. So has it been for two-wheelers, as post the festive season, sales have again declined,” said a B&K Securities analyst from Mumbai.

CV sales flat

Commercial vehicle sales at 46,788 units remained flat compared to 47,251 units in January last year.

LCVs sales continued to grow due to intra city mobility and replacement of heavy trucks, leading to declining demand for heavy commercial vehicles.

However, when compared month-on month, sales of heavy commercial vehicles have shown resilience with a lower decline.

“The cyclical downturn in the commercial vehicle industry would get over and a high growth in the medium and heavy commercial vehicles industry could be expected. But in case of two-wheelers, interest rates have not fallen. With consumers expecting a rate cut, customers would have postponed buying two-wheelers which has led to a decline,” said Mr Mahentesh Sabarad, Senior Research Analyst, Centrum Broking.

Passenger car sales in January decelerated at 8.5 per cent as Maruti Suzuki, the largest player, posted flat sales at 54,366 units.

However, led by i10, Hyundai reported a 39 per cent increase in sales at 24,296 units and after months of declining sales, premium car maker, Honda Siel also bounced back by selling 7,498 units, a growth of 29 per cent as against January last year.

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