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Carmakers are in for hard times this fiscal if domestic sales numbers for May are any indication.
Maruti Suzuki wrapped up the month with 93,519 units, up by just 3.9 per cent from 90,041 units reported in May 2010.
The bad news was that its bread-and-butter small car business slipped by 2.6 per cent to 61,048 (62,769) units even while sales of the SX4 and D'zire were up 24.2 per cent to 13,514 (10,883) units.
Within industry circles, the general perception is that consumer sentiment has taken a nosedive following the recent Rs 5/litre petrol price hike. Maruti has a diesel engine option but it is not the easiest of tasks to ramp up capacity and extend this to its entire small car range.
Even though a diesel price hike is on the cards, it will continue to be substantially cheaper than petrol. “This will only fuel demand for diesel cars even further,” sources said. It is this price differential that has wreaked havoc with carmakers such as Honda, in particular, which will have to survive without a diesel option for the next two years.
Hyundai Motor India showed a 14.62 per cent increase in sales at 31,123 (27,151) cars while Tata Motors' numbers were down 9 per cent to 19,401 (21,324) units. Mahindra & Mahindra reported a 20 per cent increase in its sales of sport utility vehicles as well as the Verito at 16,702 (13,939) units.
Ford India's domestic sales were also down 12.8 per cent to 7,046 (8,080) units while General Motors crawled up 1.3 per cent to 8,329 (8,275) units.
Honda Siel Cars showed a steep fall of over 40 per cent to 2,334 (4,067) units thanks to the supply parts crisis following the tsunami in Japan.
Toyota's numbers, however, were up 24 per cent to 7,470 units. Volkswagen, similarly, had cause for cheer with May sales totalling 6,185 (1,796) units. Its subsidiary, Skoda, too, showed a big jump at 2,761 (1,381) units.
What has emerged clearly from the May sales data is that the 30 per cent growth seen in 2010-11 was just an aberration.
Today, companies are speaking of a ‘more realistic' 12-15 per cent and even this could be impacted if interest rates continue to hurt and customers put off buying decisions.
In two-wheelers, TVS Motor's domestic sales were up 16 per cent to 158,829 (136,221) units. Exports increased by 28 per cent to 23,062 (18,046) units.
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