BOMBAY — It was expected that with the falling interest rates and the amount of liquidity in the markets, the Indian auto sector would get into the fifth gear. With the auto finance companies, banks and financial institutions alike trying their level best to woo the consumer with extremely attractive packages and incentives, the sale of vehicles was expected to skyrocket. But now that the final figures, or rather, the year end report card is finally is out, the truth is far from all this.
2001-02 ended with a flat sales curve for the passenger car industry, despite March rolling in the sixth consecutive month of growth. According to statistics released by the Society of Indian Automobile Manufacturers, car sales grew 3.6 percent in March to 65,147 units from 62,886 units in March 2001. Cumulative sales in fiscal 2001-2002 remained near unchanged at 5.70 lakh units compared to 5.67 lakh units last fiscal.
The modest March spurt came despite thrifty sales by Telco, Fiat, Honda Siel and General Motors. Telco’s Indica continued to speed up in the passenger car race with the launch of its new version of Indica V2. Telco passenger car sales increased by 66 percent to 8769 units in March 2002. Correspondingly its market share in the passenger car segment has increased to 13 percent in March 2002 as against a mere 8 percent in the previous corresponding period.
Fiat sales increased by 535 percent to 4003 units this year. In this way it has continued to increase its share to 6 percent in March 2002 as against 1 percent a year back. It is another aggressive entrant in the segment in the past three months after it launched its Palio.
But what came as complete surprise was the lack of performance by the market leader, Maruti Udyog, which contributed highest share of 53 percent in total passenger car segment witnessed a fall of 7 percent to Rs.34,727 units. Its market share skidded to 53 percent in March 2002 as against 59 percent in March 2002. Does this indicate a change in the trend of car sales in India, as March is normally the month when Maruti reports its highest sales.
On the other hand, Hyundai’s growth curve remained flat. It sold 9,513 units this March compared to 9,509 units last year and 8,652 units in February 2002. It maintained the market share of 15 percent in March 2002.
Ford’s sales dropped from 2,655 units last March to 2,501 units this year. Ford Mondeo the new model launched in December 2001 was expected to be the next success story from Ford India after Ford Ikon. Ford Mondeo is among the most successful products from Ford Motor Company and the best selling car in the discerning European market. Pitted against Hyundai Sonata. Priced around Rs.17 lakh, it is the costliest car in India in the D segment after Mercedes C class.
Exports of passenger cars jumped 245 percent at 7,664 units in March. Out of this Ford’s figure itself was of 2,820 units. Maruti’s exports for March 2002 were of 3,315 units (against 1,696 units). While the export figures of Telco stood at 594 units and Hyundai’s was 928 units. On a m-o-m basis Hyundai motor showed a jump of more than 1000 percent, Maruti Udyog rose 551 percent and Ford India recorded 48 percent rise.
So if one looks at the entire picture and not one by one, the conclusion is that 2001-02 was overall not a very good year for the Indian commercial vehicle sector. It has ended the year 2001-02 with domestic sales slipping 3 percent to 1,32,250 units. However for the year ended March 2001, sales had dropped by 15 percent. So the fall has been moderated. For the month of March 2002, the sector has registered a 2 percent drop in domestic sales to 18,642 units. But the car companies, undaunted are now all the more sure of making the coming fiscal a grand success. Most of the companies have major plans. Starting with the market leader, Maruti is planning to cater to the taxi segment, which has a huge potential in India, in order to generate volumes for its Omni Van On the other hand, Telco has various cards up its sleeve. For starters, it plans to launch the existing Indica version fitted with a turbo-charged diesel engine. And this is expected to be soon followed up with the launch of the sedan and estate versions of the car. Indica Saloon, a three-box Indica with a 1.4 liter turbo diesel engine, and Aria Coupe, a two-seater sports coupe are the other two models expected to be added in the Tata stable.
Hyundai is all set to launch its 1.1 liter engine new Santro, priced marginally higher than the existing ones. This year, it is also likely to launch new products like the Sports-utility-vehicle Terracan and the mini-van Matrix.
Fiat India is in the process of launching the new 1.6 liter Siena. It is also coming out with a sportier version of Palio, called the Sport..
