Maruti Swift and Dzire sales fall for the first time in years

The Maruti Swift and the new Dzire's sales declined for the first time in years in April. Honda Amaze's sales also slipped in negative in April for the first times since its launch a year ago. While companies attributed the fall in wholesale front to inventory correction and seasonality, analysts pointed to increasing competition from the likes of Hyundai Xcent and Grand.

In April, volumes of compact sedan Amaze slid 30.85% to 3,355 units while its rival Dzire fell 17.67% to 16,008 units. Swift hatchback volumes slipped 4% to 15,874 units. In the last five years, only during the strike in Maruti Suzuki factories did the sales of Swift and Dzire fall.

A Maruti Suzuki spokesperson said a single month's wholesale figure does not reflect the right picture and it is not a right indicator of demand. "These figures vary depending on the several factors including the short-term stock correction. The combined retail volumes for Swift and Swift Dzire are up 8% in April," the person said.

Jnaneswar Sen, Senior VP for sales and marketing at Honda Cars India, said bookings for Amaze remained strong in April. He attributed the volume fall to seasonality. "We also had to adjust our production because of two days of shut down on account of elections, plus we had adjusted our production more in favour of City over Amaze as the waiting period for City is much higher," Sen said.

Analysts, however, feel both Dzire and Amaze are facing the heat from Hyundai Xcent. "There is no doubt Xcent will eat into the volumes of Dzire and Amaze," said Puneet Gupta, associate director at IHS Automotive. While it's still early days for Hyundai Xcent, it has already overtaken Amaze to become the second-largest selling compact sedan in April. Hyundai Grand i10 continues to do well in the compact segment, putting pressure on Swift. Rakesh Srivastava, senior vice-president for sales and marketing at Hyundai Motor India, said the company has so far sold more than 82,708 units of Grand i10 at an average of 10,340 units per month. "Xcent too has carried the momentum ahead.

With its strong value propositions, we foresee Xcent becoming a strong performer in its segment," he added. While the compact sedan space is growing, with the entry of more models, it will be difficult for Maruti Suzuki and Honda to hold on to market share in the segment.

Gupta of IHS Automotive said that instead of building volumes from the existing segment, it makes more sense for Maruti Suzuki and Honda to look at other segments like compact MPV and SUVs or bigger sedans to bring in incremental numbers.