NEW DELHI: Car sales continued their scorching pace in December, the double-digit growth in a typically slow month, capping a successful year for
the automobile industry, and coming ahead of another one that promises to be just as spectacular due to a recovering economy and burst of launches.
All car companies saw robust sales last month, with market leader Maruti Suzuki posting a 36% surge in sales, while rival Hyundai’s sales grew 43%. The December sales growth was, however, less than in November when sales leaped to the highest in five years. Still, the results that rode an imminent price hike in January and huge discounts are a pointer to the cheery consumer mood that has bolstered vehicle purchases since last February.
Indian auto sales were clobbered early last year after the economy slowed and banks became skittish about lending for buying vehicles. An array of tax cuts by the government and a drop in loan rates slowly lifted vehicle sales. Backed by the introduction of new models, the automobile market grew 21% to 12.18 lakh units in the first eight months of the fiscal.
The momentum continued in December. Maruti Suzuki’s sales rose to 71,000 units in the month, its hatchback Alto, Wagon R, Zen, Swift, A-Star and Ritz, all seeing brisk purchases. While its oldest model M800 dropped 12% to 2,574 units, sedans Swift DZire and SX4 grew 20% from the year before. Maruti saw a 60% rise in sales in November.
Hyundai Motor India saw its December sales rising 43%, the push for the 22,252 units sold coming from premium hatchback i20. The South Korean carmaker too had a better November when sales increased 93%. The country’s largest car exporter also shipped 9% (24,965 units) more cars in December from a year earlier. “New products have helped maintain the momentum in sales in the past few months,” said Hyundai marketing and sales director Arvind Saxena.
Indeed, the key to the world’s second-fastest growing auto market this year will be launches — many of them at the Auto Expo that begins on January 5 — say analysts and industry captains.
And manufacturers seem to be ready, with a dozen passenger cars hitting the market in January alone. Majority of the launches would be small cars that form 75-80% of the world’s second-fastest growing auto market.
If Fiat’s Linea and Grande Punto, Maruti Ritz and Hyundai’s i20 and Honda Jazz were unveiled last year, General Motors’ Beat, Volkswagen’s Polo and Maruti’s Eeco, Skoda’s Yeti and Tata Motors’ new crossover vehicle at the Auto Expo are expected to keep sales ticking in 2010.
Though the recovery is picking up pace with a return to rising incomes and pent-up demand, the Indian car market remains price-sensitive. For carmakers, setting and resetting the ‘right’ price are just as critical as the design process.