New Delhi: Automakers have emerged from the financial year 2020-2021, a challenging and unprecedented year, some of them even on a high note. The just-ended financial year will be remembered for a number of reasons, including zero to meager sales in the first quarter, raw material cost increases in the third quarter and global chip shortage that eclipsed the fourth quarter.
The good news, however, for them is that they could conclude FY21 with a positive momentum in March. This upswing was driven largely by an unusually low base and also factors like easy finance, low interest rates, preference for personal mobility over public transport due to the pandemic and the supply of a range of new and affordable models of vehicles in all segments.
Consequently, the demand sentiment across segments remained unaffected in March 2021, despite a second concurrent lockdown in certain parts.
During the first peak of the coronavirus outbreak in March-April last year, sales of new vehicles collapsed with the announcement of nationwide lockdown from March 22, 2020. Carmakers said fear of a second wave of pandemic surged the demand for the low segment cars in March 2021 as preference for personal mobility increased.
Among the major players, Maruti Suzuki reported a growth of 99.31% in its total sales during March 2021 on a year-on-year basis. The country’s largest carmaker sold 167,014 vehicles last month, against 83,792 units sold in March 2020. On a sequential basis, the company reported a growth of 1.5% over February 2020, when it sold 164,469 units of vehicles.
The demand for sports utility vehicles (SUVs) also continued to remain higher led by new model launches across OEMs and better finance availability.
The second passenger vehicle giant Hyundai Motor India’ overall sales including exports grew to 64,621 units from 32,279 units sold during March 2020. “This performance has been backed by our super performer brands such as Creta, Venue, Verna, Nios and the all-new i20,” Tarun Garg, director – sales, marketing and service, Hyundai Motor India, said.
Mahindra and Mahindra reported sales of 35,187 units in March 2021. During the same period of 2020, the company had sold 6,679 units amid sales disruptions due to the COVID-19 pandemic.
In the utility vehicles segment, Mahindra sold 16,643 units in March 2021, compared to 3,111 units in March 2020.
“At Mahindra we are witnessing very good momentum in demand and have a strong pipeline of bookings across our SUV range of Bolero, Scorpio, XUV300, All-New Thar and also the Bolero Pik-up,” M&M automotive division CEO Veejay Nakra said.
“Bolero volumes for March have been the highest in this financial year and despite supply constraints the company has been able to ramp up production of Bolero Pik-up significantly during the month,” he added.
The Mumbai-based automaker sold 16,700 passenger vehicles last month in the domestic market. It had dispatched 3,383 units in March 2020.
Toyota Kirloskar Motor (TKM) dispatched 15,001 units in March, the highest ever domestic sales in March since 2013. According to TKM senior vice president Naveen Soni, the company’s sales performance in the last quarter proved to be better than the sales in the festive season of the third quarter (October- December 2021).
“Demand for personal mobility still continues to grow as we witness a surge in both enquiries and customer orders thereby registering a 7% growth in domestic sales in March 2021 when compared to the sales in February 2021,” Soni said.
Tata Motors recorded total domestic sales of 66,609 units in March 2021 as compared to 11,012 units in the same month last year. The company’s total passenger vehicle sales last month stood at 29,654 units.
“The passenger vehicle industry witnessed a strong growth in the fourth quarter of the last fiscal on a low base with robust demand for personal mobility and new launches driving the demand. The vertical posted its highest-ever sales in nine years, in March and the fourth quarter,” Shailesh Chandra, president, passenger vehicles business unit, Tata Motors, said.
| OEMs | March 2021 | March 2020 | % Change |
| Maruti Suzuki | 146,203 | 76,240 | 91.76 |
| Hyundai | 64,621 | 32,279 | 100 |
| Tata Motors | 66,609 | 11,012 | 505 |
| Mahindra | 16,700 | 3,383 | 394 |
| Toyota | 15,001 | 7,023 | 114 |
| Honda | 7,103 | 3,697 | 92.12 |
| MG Motor | 5,528 | 4,329 | 27.69 |
*Source: Industry reports
Two-wheelers
Despite restricted movement, two-wheeler sales also turned green on the back of a low base. Two-wheeler market leader Hero MotoCorp said its total sales were at 5,76,957 units in March 2021, up 72% over the same month last year.
“The recovery in consumer demand and efficient collaboration with our global distributors has enabled us to achieve these numbers. While the coronavirus pandemic continues to impact the global auto industry, we are witnessing strong preference for the wide range of motorcycles and scooters – including the premium motorcycles Xpulse and Hunk 160R – across markets, especially in Latin America,” Sanjay Bhan, head – global business, Hero MotoCorp, said.
The Chennai-based TVS Motor Company witnessed over two-fold increase in its overall sales of 3,22,683 units in March. According to TVS Motor Company joint managing director Sudarshan Venu, demand surge is the result of increased premiumisation trends which is led by higher replacement demand and improving finance penetration.
“Over the past months, we have witnessed growth across various countries with a definite shift to premiumisation. We will strive to keep this momentum going forward as we seek to delight customers with our exciting range of products,” Sudarshan noted
Premium bike maker Royal Enfield said its total wholesales in March stood at 66,058 units as against 35,814 units in the same month last year.
Outlook
Moving into the financial year 2021-2022, headwinds for the domestic auto industry include the continued increases in COVID-19 cases, which could lead to production disruptions along the vehicle supply chain; a chronic global shortage of microchips used in many facets of auto production; and the uncertain commodity market.
Alternatively, tailwinds for 2021 include a potential economic boom which is expected to come in the second half of the year, once the coronavirus vaccination is widely available and proper resumption of office and schools; and also the continued consumer preferences for personal vehicle ownership over public transportation, and low interest rate expectations.
