The downward trend in the Indian automotive sector continued and possibly worsened in July 2019 with most manufacturers including the two-wheeler companies registering lower sales in the month compared to July 2018.
The largest among them all, Maruti Suzuki India sold a total of 109,264 vehicles, a steep 33.5% lower than the 1.64 lakh units it sold last year. The decline in the case of Mahindra & Mahindra was 15%. selling just 40,142 units this year. The fall at Honda Cars India was even steeper with the Japanese major managing to sell only 10, 250 cars in July 2019, a whole 48.67% less year-on-year.
The second largest player in the sector Hyundai didnâ€™t have it smooth either. Its sales of 57,310 in July this year was 3.5% lower than the number of vehicles the company sold in July 2018.
All these figures represent the sales figures for the domestic market. There has been a decline in the number of cars exported too, it is learnt.
Coming to scooters and motorcycles, the figures for two companies, TVS Motors and Royal Enfield are available and the picture they present is not different from the above for the four-wheelers. While TVS Motors sold 2,79,465 vehicles taking a 13% hit, that of Royal Enfield dropped 22% to 54,185.
Analysts have more or less repeated what has already been stated in the recent past. The monsoon delay, overall downturn in the economy and the liquidity constraints in the financial sector have all been included in this explanation for the continued slump in the automobile sector. As already suggested, the car dealers have also played it quite safe by avoiding piling up of inventories at their end. With the reduced off-take, the manufacturers have cut down on their output.
The cascading effect has already been felt at the Indian automobile component manufacturersâ€™ end with around one million contractual employees facing the axe.
Experts feel the trend is not likely to reverse in the next quarter either. Apart from the reasons cited above, the costs involved in the implementation of BS-VI, and the consequent increase in the prices of cars will make it even more difficult for the industry to pull up the sales numbers.
Thereâ€™s no immediate signal from the government that it plans to do anything at its end to improve the situation.