New car, SUV sales surge due to heavy festive demand

Car sales in October 2020 have seen a sharp uptick, after witnessing a dull stretch for the predominant part of the apparently jinxed 2020 calendar year. Passenger vehicle manufacturers finally saw some robust growth last month on the back of healthy demand in the market. However, it is to be noted that these numbers are essentially dispatches from carmakers to their dealers.

• Maruti Suzuki leads the sales charts with 1,63,656 units sold (up 17.63 percent)
• Hyundai and Kia achieve highest ever monthly sales of 56,605 units and 21,021 units, respectively
• Tata Motors posts significant 79.33 percent growth in sales, year-on-year

Driven by the festive cheer around Navratri, Dussehra and Eid in October as well as the upcoming mega festival of Diwali on November 14, carmakers have reported significant dispatches to their dealers all across the country, who are witnessing good offtake of new cars from their showrooms.

What also seems to have helped is the strategic action of some car manufacturers such as Kia Motors India and Toyota Kirloskar Motor – to have launched brand-new products – right before the start of the festival extravaganza, which although subdued, is certainly bringing a positive mood to the automotive market amid the persistent tension of the COVID-19 pandemic.

The country’s largest carmaker Maruti Suzuki led the pack with a 17.6 percent uptick and strong demand for its hatchbacks and the Dzire compact sedan model, while Kia Motors India and Tata Motors continued to ride the wave of demand for SUVs and MPVs such as Kia’s Seltos and Sonet and Tata’s Nexon. At the same time, Korean major Hyundai achieved its highest-ever monthly sales in a drab market environment, giving confidence to the overall industry and driving towards business recovery.

Let’s take a manufacturer-wise look at the sale performance in October 2020:

Maruti Suzuki India: 163,656 units (17.63%)

The company sold 1,63,656 units last month (October 2019: 1,39,121 / +17.6%) with strong demand for cars like the Wagon R, Swift, Celerio, Ignis, Baleno, Dzire and Tour S. The cars collectively sold 95,067 units (75,094 / +26.6%).

On the other hand, demand for the entry-level Alto and S-Presso remained flat at 28,462 units (28,537 / -0.3%), while Maruti’s mid-size sedan, the Ciaz, continued its dive to 1,422 units (2,371 / -40%). The brand’s SUVs and MPVs, however, registered an increase and went home to 25,396 buyers (23,108 / +9.9%). It has to be noted that Maruti now offers a petrol-only utility vehicles portfolio that includes the Vitara Brezza, Ertiga, S-Cross and XL6.

The two vans, Omni and Eeco, too registered a notable 33 percent growth, with sales touching 13,309 units last month compared to 10,011 units in October 2019.

Hyundai Motor India: 56,605 units (8.85%)

India’s No. 2 carmaker by sales volumes, Hyundai, registered its highest-ever domestic market monthly sales of 56,605 units (October 2019: 50,010). Hyundai’s previous best was 52,001 units in October 2018. While the Korean carmaker has not shared details of the model-wise sales, it can be gleaned that the biggest contributors to the October 2020 total would be the new Creta, the current SUV market leader, and the Venue compact SUV, both benefiting from the boom in SUV sales.

Sustained demand for the mid-size SUV, which was launched just before the first lockdown in March and still managed to pull buyers into showrooms even in a nervous market environment to clock 1,15,000 bookings within six months, is one of the top reasons for Hyundai’s strong performance, which is also its best-ever with respect to monthly sales numbers.

What has also added to the numbers are the dispatches of the all-new third-generation Hyundai i20 premium hatchback, which has been unveiled and is now set to be officially introduced into the market on November 5. The car will give competition to arch rival Maruti Suzuki Baleno and in its latest avatar, is coming loaded with a host of feel-good features including a sunroof, Bose premium audio system and six airbags for safety.

Tata Motors: 23,617 units (79.33%)

Tata sold a total of 23,617 units (October 2019: 13,169) last month, which constitutes a 79 percent year-on-year growth. This is clearly driven by robust demand for its Tata Nexon facelift, as well as Altroz premium hatchback. The company is also seeing demand picking up for the Harrier SUV after it was given an automatic transmission option with the latest facelift earlier this year in March.     

Kia Motors India: 21,021 units (64%)

Like Hyundai, Kia Motors India too nudged its highest-ever monthly sales of 21,021 units, registering a significant 64 percent year-on-year (YoY) uptick, while also breaching the 1,50,000-unit sales mark since its foray into the Indian passenger vehicle market in August 2019.

The Kia Seltos went home to 8,900 buyers while the newly-launched Sonet, which has already garnered 50,000 bookings since its launch in September, reached 11,721 customers. With the healthy order book in hand, Kia is mulling starting third-shift operations at its plant in Anantapur.

Mahindra & Mahindra: 18,622 units (1%)

Mahindra & Mahindra dispatched a total of 18,622 vehicles in October 2020, a marginal growth of 1 percent over October 2019 (18,460). The total includes 18,622 SUVs and MPVs, which is a 4 percent increase in just the utility vehicles. The Scorpio, Bolero and XUV300 continued to do well for the brand, while booking numbers for the new Thar also bode well. 

Toyota Kirloskar Motor: 12,373 units (4.27%)

Toyota sold 12,373 units in October (October 2019: 11,866 / 4.27%). This is the best result in recent months for the carmaker and a month-on-month growth of 52 percent (September 2020: 8,116 units). The company had launched the Maruti Suzuki Vitara Brezza-based Urban Cruiser just ahead of the festive season.

Commenting on the month’s performance, Naveen Soni, senior vice-president, Sales and Service- TKM said, “The month of October has been our best month so far since March 2020. The festive season has proved to be bullish as we witness demand surging, month on month. This has been true of our retails too as order flow has been smooth, from the very beginning.

Honda Cars India: 10,836 units (8.25%)

The Japanese carmaker clocked 10,836 units last month (October 2019: 10,010 / +8.25%). While the growth is marginal, the carmaker says it is as per plans. According to Rajesh Goel, SVP and director, Marketing and Sales, Honda Cars India, “We have seen positive sales momentum in line with market sentiment and our October results have been as per our plan.”

The company had launched the fifth-generation Honda City – its best-selling model in India – earlier this year in July. While the mid-size sedan has its loyal customer base who value its comfort, powertrain and design attributes, the market, however, is witnessing a distinctive shift towards SUVs. The new City is perhaps facing rough waters from the competition including Hyundai's Creta and Kia's Seltos, which play in the same price bracket.

As a result, Honda was doling attractive schemes, including offering a Rs 30,000 exchange bonus on the latest City in October. The Civic executive sedan was also running massive discounts of up to Rs 2,50,000 while the Amaze was offered with Rs 47,000 in benefits. The Jazz and WR-V, on the other hand, came with benefits worth Rs 40,000 last month. With Diwali and Dhanteras lined up for November, expect the schemes to continue through to the end of this month as well.

So, with the festive season bringing some respite for the industry and a glimmer of hope for the much-needed recovery of the entire sector as well as economy, it would be worth the wait to see how things unfold after November, which will determine whether the demand is really here to sustain itself through to most of 2021. We will keep a close tab on the progress, as we are sure carmakers will too.

Also see:

Motorcycle sales rise to record highs in the month of October

Bestselling motorcycles in September 2020