Car sales sluggish, top companies reduce dealer dispatches

NEW DELHI: Top car companies Maruti Suzuki, Hyundai and Tata Motors continued to reduce wholesale deliveries to dealerships as consumer demand remains relatively low compared to last year, leading to inventory build-up over the past few months. The move comes even as the industry prepares to enter the festive period with the auspicious Ganesh Chaturthi soon.
Maruti’s domestic passenger vehicles’ wholesales in Aug came down by 8% to 1,43,075 units against 1,56,114 units in same month a year ago.Deliveries of small cars such as Alto and S-Presso – which are already facing a shrinking market – declined to 10,648 units last month as against 12,209 units a year ago. Models like Baleno, Celerio, Dzire, Ignis and Swift hatchbacks also saw a decline of 20% to 58,051 units as compared to 72,451 units in the year-ago month. Utility vehicle and SUV dispatches for Maruti, consisting of Grand Vitara, Brezza, Ertiga, Invicto, Fronx and XL6, however, rose to 62,684 units as compared to 58,746 units in the year-ago month.

Rival Hyundai, which is working on an IPO, reported a similar 8% dip in domestic dispatches in Aug at 49,525 units, from 53,830 units in the year-ago period.
Tata Motors reported a 3% decline in passenger vehicle wholesales at 44,142 units last month as compared to 45,513 units in Aug last year.
Maruti’s senior executive officer (marketing & sales) Partho Banerjee said the company reduced dispatches as an inventory reduction measure. The company’s dealer stock levels, which were at 38 days at the beginning of Aug, have dropped to 36 days.
But while the top three companies cut numbers, others such as Kia and Toyota have been adding to dealer inventory. Kia India said its wholesales increased 17% in Aug to 22,523 units. It had dispatched 19,219 units to dealerships in Aug last year.