Car sales inch upwards in March 2014

  • Apr 2, 2014
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Festivals, special offers, discounts and excise duty reduction join forces to encourage car buyers. And it works, albeit, marginally.

Car Sales March 2014

Finally car sales have shown marginal improvement in March 2014, if the sales report of major car manufacturers is anything to go by. During the end of the financial year, most car companies were offering special schemes and discounts to meet their last minute sales target. Of course with Gudi Padwa celebrated this month, many car buyers did make their purchases on this auspicious day, adding on to the numbers for most companies.

The big gainers this month have been Honda, Hyundai, Ford and Nissan. Both Hyundai (HMIL) and Honda Cars India have recently introduced new models, the new Xcent and next gen City respectively, which attracted new car buyers. Hyundai's domestic sales rose by 3.38 per cent to 35,003 units from 33,858 units they sold in the same period last year. The Honda reported a whopping jump of 83.4 per cent in its domestic sales at 18,426 units, thanks to its entry in the diesel cars segment with the City and Amaze.

Commenting on the company’s sales performance, Jnaneswar Sen, Sr vice president, marketing and sales said, “The year also witnessed our entry into the diesel segment with i-DTEC diesel engine technology which has received an overwhelming response in the market.  With both manufacturing plants in operation, as well as two new models, the stylish mid-sized MPV, Honda Mobilio and the all-new Honda Jazz due for launch this financial year, we look forward to another year of growth.”

Both Ford and Nissan, riding on the popularity of their compact-SUVs – EcoSport and Terrano, did keep the cash registers ringing. Ford India’s domestic sales rose by 20.58 per cent to 6,356 units, and Nissan grew from 2,125 units of last year to 7,019 units in March 2014. Although the Nissan Terrano has been the biggest boost for the company’s impressive growth, the newly resurrected Datsun brand chipped in a fair amount as the GO small car contributed 2,072 units.

Another manufacturer which reported positive growth and seems to be on the right path is Tata Motors. The Indian automobile major came back on track with dispatches of its passenger vehicles rising by 2.37% in March this year.

With the general elections round the corner and the formation of a new government in the Centre, there is definitely a sense of uncertainty in the minds of the consumer. And this is common in the automobile industry as well. India’s largest car manufacturer, Maruti Suzuki did get a feel of this already with its domestic sales dipping by 5.2 per cent in March’14 to 1,02,269 units as against 1,07,890 units in March last year. The primary reason for this downslide has been the loss of traction in its entry level hatchback range, including the Alto and WagonR, which dropped by 11 per cent to 40,085 units. This is big blow for the Maruti, but one must also note that the company has recently discontinued the iconic M800. Having said that, the introduction of the Celerio, and the AMT revolution it has brought along, the premium hatch segment saw positive growth by 9.3 per cent to 28,285 units in March 2014. The company also has the blockbuster Swift and Ritzs models in the segment.

Sadly, India’s most popular SUV maker, Mahindra & Mahindra, is under immense pressure from newer models like the Renault Duster, Ford EcoSport and Nissan Terrano; and hasn’t been able to cash on the 6 per cent reduction of excise duty on SUVs. Earlier this year, in the Interim Budget, the finance minister had announced a cut in excise duty to 8 per cent from 12 per cent for small cars, scooters, motorcycles and commercial vehicles; 24 per cent from 30 per cent for SUVs; 20 per cent for mid-sized cars from 24 per cent; and 24 per cent for large cars from 27 per cent.

Mahindra reported 1.49 per cent lower domestic sales at 48,490 units as against 49,225 in the same month previous year. Speaking about the company’s performance Pravin Shah, chief executive, automotive division, Mahindra & Mahindra Ltd. said, “Post the reduction in the excise duty across all segments, the auto industry has witnessed queries going up, which has not yet translated into a surge in sales. We do hope that the sentiments improve and post the elections; there is an increase in demand as well. At Mahindra, we are happy with our overall performance for the month of March where the de-growth is negligible at 0.5%. Going forward, we continue to be optimistic for the future and expect to witness a growth momentum during FY 2014-15.”

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