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Two-wheelers post 32% growth in Jan, cars & UVs also in fast lane

Auto makers posted robust sales growth in January, with two-wheelers growing at a strong 32% and passenger vehicles at a healthy 9%.

two wheelers, honda, bajaj, india, automakers in india
In the two-wheeler segment, Honda Motorcycle and Scooter India sold 4,88,809 units

Auto makers posted robust sales growth in January, with two-wheelers growing at a strong 32% and passenger vehicles at a healthy 9%. Growth in the month was fuelled by strong rural demand and aided (in case of two-wheelers) by a low base in January last year, when note ban had disrupted trade. Sales of passenger vehicles grew 11% in January last year, while sales of two-wheelers had declined 9%.

While sales growth for passenger vehicle makers ranged from (-)5% (for Honda) to a whopping 55% (for Tata Motors), the disparity was far less in the case of two-wheeler makers, with most of the companies posting more than 30% growth.

According to analysts at Motilal Oswal, “Rural markets continue to see healthy demand traction, as the passenger vehicle and two-wheeler segments continue to see average retail growth of 14-16% and have been outperforming urban growth for the fifth consecutive month.”

While strong growth was reported by most players, Maruti Suzuki’s growth of 5% year-on-year was disappointing. According to analysts at Credit Suisse, “This month, the disappointment came from market leader Maruti, which saw only 5% growth. Maruti did not have a low base, but others like Tata, M&M, Toyota had strong growth on a low base.”

Maruti’s growth came from its compact cars such as the Baleno and the new Dzire, which grew 22% in January over the same period last year. The utility vehicle segment grew 27%, led by strong sales of the Ertiga and the Brezza. However, sales of its mid-size sedan Ciaz fell 23%, while sales of WagonR and Alto dropped by 12%, hurting its performance.

Tata Motors continued its strong run in passenger vehicles space with sales growth of 55%, riding on demand for its new model, the Nexon.

Mayank Pareek, president, passenger vehicles business unit, Tata Motors said, “While Tiago continues to lead the growth in cars at 27%, the Nexon and HEXA have attracted new set of SUV buyers, resulting in 188% growth in UVs. We continue to be optimistic and hope this growth momentum continues.”

Honda Cars, however, reported a 4.8% decline in sales to 14,838 units.

In the two-wheeler segment, Honda Motorcycle and Scooter India sold 4,88,809 units, growing 33%, while Bajaj Auto posted a strong revival with a 36% growth. The two-wheeler maker had posted a meagre 2% volume growth in the quarter ended December 2017. Hero MotoCorp, which had seen sales drop by 14% in January last year, witnessed a turnaround by growing at 31%.

Sales of medium and heavy commercial vehicles grew despite component supply constraints, which continue to plague the industry. Discounting by truck makers, higher demand due to truck overloading restrictions in many states and a rise in construction and mining activity fuelled growth.

Heavy vehicle sales of Tata Motors grew 13% to 12,804 units, while Ashok Leyland’s volumes rose 13% to 13,643 units.

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First published on: 03-02-2018 at 04:53 IST
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