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The automobile sector closed 2019 on a rather depressing note with the sales in December 2019 declining 13 per cent across all categories, with segments such as passenger cars, two-wheelers and commercial vehicles recording their worst fall in the last two decades.
On a yearly basis too, 2019 was not a cheerful year for the industry, as sales across categories declined by around 14 per cent to 2,30,73,438 units in the last calendar year as against 2,67,58,787 units in January-December 2018.
According to the industry body Society of Indian Automobile Manufacturers (SIAM), the challenges remain despite the government initiating several measures to spur growth..
“Challenges remain for the auto industry despite the government bringing in several growth enablers. the GDP growth rate remains an area of worry as th commercial vehicle segment is clearly linked to it. Besides, low demand from rural areas continues to be a matter of concern,” Rajan Wadhera, President, SIAM, told reporters here.
Transition to BS-VI regime
In passenger vehicles, utility vehicles are driving sales as other segments are not performing that well, he said, adding that the situation is going to remain tough due to impending changeover to the BS-VI regime.
“We expect prices of commercial vehicles to go up by 8-10 per cent due to BS-VI norms, and it is going to impact demand. But, if economic growth is there, this factor would not be such a sore point,” Wadhera said. Passenger car sales declined by 8.40 per cent to 1,42,126 units during the month, compared with 1,55,159 units in December 2018. Similarly, the commercial vehicle segment saw a 12.32 per cent decline in sales to 66,622 units in December 2019 from 75,984 units in the corresponding month of the previous year.
Two-wheeler segment
In the two-wheeler segment, motorcycle sales declined by 12 per cent year-on-year (YoY) to 6,97,819 units during the month, from 7,93,042 units in December 2018, SIAM said on Friday.
Scooter sales also declined by more than 24 per cent to 3,06,550 units in December 2019 from 4,06,137 units in the corresponding month of the previous year.
The segment that continues to grow is utility vehicles, led by the new launches, including the Hyundai Venue, Kia Seltos and MG Hector.
The segment recorded a 30 per cent YoY growth in December 2019 to 85,252 units as against 65,567 units in December 2018.
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