The coronavirus outbreak is expected to have worsened the auto sector’s troubles in March, when they were in the midst of shifting to stricter emission norms. The auto industry has been facing an unprecedented fall in sales and with the lockdown across the nation because of the coronavirus, it certainly has taken a toll on the numbers in March this year.
According to some reports, the sales in March 2020 are expected to be down by 40-80% across segments and performance in March has eclipsed declines during events such as demonetisation in late 2016, implementation of the goods and services tax (GST) in 2017 and the global financial crisis of 2008.
Passenger vehicle sales are seen at 145,000-150,000 units in March which is half of what the numbers were in 2019. The two-wheeler side of things too is bleak as sales are expected to drop by almost 45 per cent.
Amid country-wide lockdown, market leader Maruti Suzuki on Wednesday posted a 47.4% decline in sales of passenger vehicles in the domestic market to 76,240 units, 2,104 units of domestic OEM sales and 4,712 units of exports.The company had sold over 1.45 lakh passenger vehicles in March 2019. With this, the Company ended FY 2019-20 with total sales of 1,563,297 units.
As per the data shared by the company, sales of mini segment vehicles — Alto, S-Presso2, were down 5% to 15,988 units as against 16,826 units in the year-ago month, while sales of compact segment vehicles — WagonR, Swift, Celerio, Ignis, Baleno, Dzire, Tour S, fell nearly 51% to 40,519 units from 82,532 units in March 2019. Sales of mid-size Ciaz was down 49.3% to 1,863 units as against 3,672 units in the year-ago month.
Sales of utility vehicles — Gypsy, Ertiga, S-Cross, Vitara Brezza, XL6 — was also hit during the month, falling 53.4% to 11,904 units as compared to 25,563 units in March 2019, while sales of Vans — Omni, Eeco, was down 63.7% to 5,966 units from 16,438 units in the year-ago month.
The exports during the month also fell 55% to 4,712 units as against 10,463 units in March 2019.
The company, however, said that the sales during March 2020 are not comparable with sales in March 2019 “due to the suspension of operations with effect from March 22nd 2020, in line with national policy”.
Another major player in the Indian automobile market, Toyota Kirloskar Motors(TKM) showed similar signs. – Having successfully liquidated all its BS4 stocks even at the dealership level, TKM sold a total of 7023 units of BS6 vehicles to its dealers (wholesales) in the month of March 2020. To lessen the burden on its dealers, TKM withheld sales by 50% for the month of March 2020, just ahead of the 21 days national lockdown called upon by the Government of India. The company also exported its last batch of 999 units of the Etios series last month thus clocking a total of 8022 units.
Toyota Kirloskar Motor had sold a total of 12,818 units in the domestic market in the month of March 2019. The company had exported 844 units of the Etios series in March 2019, thus clocking a total of 13,662 units in the same month last year.
| Sales Data | March sales | 2020 | 2019 | Month on month comparison |
|---|---|---|---|---|
| Domestic | 7023 | 12,818 | 55% | |
| Exports | 999 | 844 | 118% | |
| Total | 8022 | 13,662 | 59% |
Commenting on the monthly sales, Mr. Naveen Soni, Senior Vice President, Sales and Service, Toyota Kirloskar Motor said, “Even though the company has been long successful in liquidating all BS4 stock and transitioning into a 100% BS6 manufacturing facility, last month has been very challenging for us, both in terms of sales as well as production. With the spread of COVID-19 threat in various parts of the country followed by the 21 days national lockdown, the company’s priority was to ensure the safety and wellbeing of all its stakeholders and most importantly our dealers and their staff who are in the frontline.”
On a related note, MG Motor India, today announced that it has recorded a total retail sale of 1518 units in March 2020. This includes 116 units of ZS EV and 1402 units of the HECTOR. Since the Hector was launched in June last year and ZS EV in January this year, there is no comparable sales data as such.
Commenting on the sales performance during the month, Rajeev Chaba, President & Managing Director, MG Motor India, said, “Both MG Hector and MG ZS EV have made a mark in the Indian car market. Despite supply chain disruption globally, MG Motor continues to serve its customers. In February, our sales were impacted due to the disruption, while the situation improved during March before the lockdown was announced, resulting in the shutting down of our manufacturing plant.”
Despite the ongoing situation, the carmaker has assured its employees that there would be no layoffs and all payments to suppliers and vendors alike would be completed on time.
The carmaker, which initiated the ‘Disinfect and Deliver initiative to sanitize cars and ensure a near-zero contact with customers, before the lockdown was imposed, has decided to formalize this as a permanent process across the company even after the lockdown is lifted.
With zero stock of BS-IV units of the HECTOR across its dealerships and its factory, the carmaker has recently started production of BS-VI variants, however, it currently has very low BS-VI inventory at its dealerships and its manufacturing facility in Halol.
One manufacturer which showed impressive sales numbers in the final two quarters of the last year is Kia. Kia posted a healthy sales of 8,583 units for the month of March 2020. The company sold 7,466 units of e Seltos and 1,117 units of Carnival in the last month. While Kia Motors India retained its position of being the number 3 car manufacturer in the country, Seltos became the highest selling SUV in India for the third time in a row.
Since its launch in August 2019, Seltos has emerged as number one choice for country’s SUV buyers with total sales of 81,784 units till now. The export figure for the company in the previous month stands at 2,585 units. Owing to the global pandemic and countrywide lockdown, Kia Motors India had stopped its wholesale billings on March 16th 2020, avoiding unnecessary unsold inventory at its dealerships. Counting on the booking numbers of Kia cars, the company is expecting a positive sentiment in buyers for Seltos and Carnival after the lockdown period.
On the other hand, Hyundai Motor India registered cumulative sales of 32279 units in the month of March 2020 amid lockdown due to pandemic Covid-19.
| HMIL sales | March 2020 |
|---|---|
| Domestic | 26300 |
| Exports | 5979 |
| Cumulative | 32279 |
However, Hyundai hasn’t released its entire YoY data, therefore the growth trend for the entire fiscal year 2019-20 cannot be predicted.
However, from the above data it is clear that the trend has been downwards in terms of sales and the negative growth rate was very much on the expected lines. With the BS6 transition now complete and a string of new and exciting launches expected this year, experts have again pinned their hopes on them but how much damage does the pandemic leave in its wake is yet to be ascertained.