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Our Bureau

Mumbai, Jan. 2 The fiscal package announced by the Centre on Friday coincided with Tata Motors’ commercial vehicle sales report for December which dropped 51 per cent to 14,056 units from 28,661 units in the same period last year.

The medium and heavy commercial vehicle segment was the worst hit registering a drop of 69 per cent at 4,811 units. Light commercial vehicle sales fell 29 per cent to 9,245 units.

In this grim background, the Managing Director of Tata Motors, Mr Ravi Kant said the “positive steps” announced in the fiscal package were welcome, though the Government “needs to work on ensuring that ultimately liquidity reaches customers at reasonable costs”.

“Although some steps declared today would help commercial vehicles, the Government needs to take many more measures to substantially stoke demand as that has gone in a reverse gear. We will continue to expect more positive measures,” he added.

Ms Vaishali Jajoo, analyst with Angel Broking, said, “Tata Motors is mainly impacted by the huge volume drop in commercial vehicles which is a cyclical industry. From the third quarter of this fiscal, the cycle turned negative and may take 6-8 months from here for a revival despite the stimulus package.”

Truck sales have been falling consistently since September when they totalled 21,968 units to 12,619 units in November. This led to a partial closure of Tata Motors’ truck plants in Pune, Jamshedpur and Pantnagar.

Suppliers said orders had seen a drop of nearly 60 per cent. Some of them “had no idea” what was in store for the January-March quarter since they have had no clear communiqué. Sources said that things were not looking good thanks to sectors like mining and construction which were languishing. There was not too much cheer from the passenger car side either where domestic sales at 9,838 units (14,316) mark a decline of 31 per cent over December 2007.

More Stories on : HCV/LCV/Tractors | Performance | Tata Motors Ltd

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