The Covid-hit passenger vehicle industry weathered demand as well as supply-side challenges to emerge stronger at the end of FY2021.
02 Apr 2021 | 10330 Views | By Mayank Dhingra
When FY2021 opened on April 1, 2020 few would have imagined what a stressful year it would be for corporates, countries and citizens. It was not long into the fiscal year that captains of industry managing automobile manufacturing companies in India were looking for means to solve what would be remembered ...
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When FY2021 opened on April 1, 2020 few would have imagined what a stressful year it would be for corporates, countries and citizens. It was not long into the fiscal year that captains of industry managing automobile manufacturing companies in India were looking for means to solve what would be remembered as one of the most-critical challenges of their careers – the nationwide lockdown – announced by the government as a preventive measure to combat the Covid-19 pandemic.
While no business or marketing pundit could hazard a guess as to what the future would bring, nobody would have also imagined a recovery this fast for the PV industry, where overall FY2021 numbers are near those of FY2019.
Estimated figures suggest that in March, the pack of 14 key carmakers together clocked sales of 320,537 units, registering a notable year-on-year (YoY) growth of 127 percent albeit on the back of a low year-ago base in March 2020, when sales were pegged at 141,139 units amidst rising concerns of the pandemic hitting India.
While the cumulative and official FY2021 industry figures will only be available in about 10 days from now when SIAM announces them, PV OEMs have released their individual performance figures which tell a telling story of resurgence and resilience.
Maruti Suzuki India: 1,293,840 units / -8.5%
India's PV market leader reported sales of 146,203 units in March 2021 (March 2020: 76,240 / +91.76%). Its cumulative sales tally for the 11-month FY2021 stood at 1,293,840 units (FY2020: 1,414,346 / -8.5%).
With sales being heavily impacted in the initial quarters of the last fiscal, Maruti’s entry-level Alto and S-Presso ended up clocking 24,653 units in March (March 2020: 15,988 / +54.19%) and 226,159 units in FY2021 (FY2020: 247,776 / -8.7%). The six-car pack of the Wagon R, Swift, Celerio, Ignis, Baleno and Dzire – that together accounted for over 56 percent of the company’s volumes – went home to 82,201 buyers last month (March 2020: 40,519 / +103%) and to 719,647 buyers (FY2020: 787,610 / -8.6%) in the fiscal.
Maruti’s sales in the surging UV segment acted as a saving grace with being the one to register the least of the negative growth rates. The all-petrol line-up of the Vitara Brezza, S-Cross, Gypsy, Ertiga and XL6 recorded sales of 26,174 units in the closing month of the fiscal (March 2020: 11,904 / +119%) and 229,109 units (FY2020: 235,298 / -2.6%) in the 11-month period of FY2021.
Clearly, a month of lost sales in April 2020 is what could be understood to be the key reason for the de-growth in most sub-segments, when otherwise the company has managed to post a shining recovery despite lack of any diesel offerings in its portfolio in the BS VI regime.
Hyundai Motor India: 471,535 units / -2.8%
The Korean carmaker was able to double its sales volumes in March 2021 to 52,600 units, as against 26,300 units in the same month last year. In terms of FY2021 numbers, it clocked 471,535 units (FY2020: 485,309 / -2.8%).
What has been a contributing factor to Hyundai’s sustained growth in this challenging year has been the introduction of its latest second-generation Creta midsized SUV. The car was launched last year on March 16, just a few days ahead of the entire nation coming to a standstill.
But, a potent product with all the right credentials for success meant that the company did not take long in attracting customers to showrooms, or even to its digital retail portal – Click-to-Buy – and que up for the crossover which is currently commanding wait times of up to 9 months in some cities.
Assisting the Creta in the sales momentum for the company were the sub-four-metre Venue crossover, Grand i10 Nios and Aura twins, as well as the newly-introduced i20 premium hatchback that was introduced in November.
“Hyundai Motor India has portrayed resilience and perseverance towards contributing to the revival of the Indian auto industry. The sales momentum achieved over the last few months was further strengthened with the March numbers,” said Tarun Garg, director, Sales and Marketing, HMIL, in a press statement.
Tata Motors: 222,025 units / 69%
If one were to pick the star of the show from 2020, it would be homegrown Tata Motors. The company posted resounding success in the form of a 69 percent YoY growth in its PV business in FY2021, backed by models such as the Nexon crossover, Harrier SUV and the all-electric Nexon EV.
While it registered sales of 29,654 units in March 2021 (March 2020: 5,676 /+422%), the carmaker clocked cumulative sales of 222,025 units in FY2021 (FY2020: 131,196 / +69%) – its highest-ever annual sales in all of eight years.
Crucial models such as the Nexon and Harrier got their facelifts last year, while the introduction of the highly-competent and affordable Nexon EV, meant that Tata Motors witnessed a three-fold increase in EV sales to 4,219 units in FY2021, compared to the previous fiscal.
According to Shailesh Chandra, president, Passenger Vehicles Business Unit, Tata Motors, “The PV industry witnessed a strong growth in Q4FY2021 on a low base with robust demand for personal mobility and new launches driving demand. Tata Motors’ PV Business registered its highest-ever sales in nine years in March 2021 as well as Q4 FY2021.”
“In the EV segment, while we sold 4,219 units in FY2021, registering a three-fold increase over FY2020. The company also registered its highest-ever monthly and quarterly sales of 705 units and 1,711 units in March 2021 and Q4 FY2021.”
Kia Motors India: 155,286 units / 35%
Although it didn’t issue an official press release until this news report was filed, the Hyundai-Group company is learnt to have clocked sales of 19,100 units in March, therefore, more than doubling its volumes from 8,583 units sold in March 2020. On a fiscal-year basis, Kia Motors India cumulatively sold 155,286 units (FY2020: 84,903 / +34.89%).
Other than the midsized Kia Seltos that was doing amply good for Kia’s fortunes since it entered India in August 2019, Kia Motors India introduced the sub-compact Sonet crossover in September last year, which has played a key role in augmenting the carmaker’s growth.
The Sonet comes feature packed alongside offering a host of powertrain and drivetrain options including a diesel, petrol, manual, automatic as well as intelligent manual transmission.
Mahindra & Mahindra: 157,093 units / -69%
For UV major Mahindra and Mahindra (M&M), March 2021 sales stood at 16,700 units, an uptick of 394 percent over 3,383 units sold a year ago. For FY2021, M&M registered a sizeable sales decline of 69 percent with cumulative sales of 157,093 units (FY2020: 186,942).
The past year witnessed Mahindra’s XUV300 as well as its second-generation Thar launched in October be the top scorers for the company. With its five-star crash safety rating, the XUV300 has been giving feisty competition to other contenders in the segment, while the new Thar with its appeal and practicality is wooing both enthusiasts and family buyers alike.
Toyota Kirloskar Motor: 93,128 units / -18.36%
Japanese carmaker TKM registered its best March sales last month in seven years. The company clocked 15,001 units (March 2020: 7,023 / +114%). TKM’s FY2021 performance, however, is slightly lower compared to the previous fiscal. It registered cumulative sales of 93,128 units between the 11-month period of May 2020 and March 2021, as against 114,081 units for the 12-month period between April 2019 and March 2020. This constitutes to a YoY decline of 18.36 percent on a YoY basis.
The 2021 Innova Crysta and newly-launched refreshed Fortuner and its Legender variant are already commanding waiting period in some cities.
Renault India: 92,268 units / 3.05%
Renault India is learnt to have sold 12,356 units last month (March 2020: 3,269 / +278%). While the Triber MPV has been doing well for the company, its foray into the compact SUV segment with the new Kiger has potential to notch its volumes even further. Cumulative numbers for FY2021 stand at 92,268 units (FY2020: 89,534 /+3.05%).
Honda Cars India: 82,074 units / -19.54%
The carmaker which had to take the tough call of shutting manufacturing operations at one of its two sites in India in the pandemic-struck year, clocked overall sales of 82,074 units in FY2021 (FY2020: 102,016 / -19.54%). Last month, however, Honda Cars India’s products went home to 7,103 buyers, an uptick of 92 percent over a low year-ago base of 3,697 units.
The fifth-generation Honda City sedan that was finally introduced in July last year after a delay of couple of months due to the Covid calamity, has been raking in the numbers for the company. Despite facing strong headwinds from midsized SUVs like the Hyundai Creta and Kia Seltos, the Honda City is standing firm on its ground by offering comfort, aesthetics and practicality.
According to Rajesh Goel, senior-VP and director, Marketing & Sales, HCIL, “FY2021 was an unprecedented year full of Covid-led challenges. After an extremely tough first half, strong efforts both at the production side and dealer network helped HCIL to witness positive growth of 39 percent in the H2 of the fiscal. Buoyant customers have injected fresh vigour in the market and we are striving to sustain the growth momentum in future.”
“However, the supply constraints due to continuing global shortage of semi-conductors has impacted our production volume and dispatches particularly for Honda City in March. We will continue to make efforts towards restoring normalcy and hope this issue gets resolved at the earliest,” he added.
MG Motor India: 35,597 units / 62%
The carmaker which went on a product-refresh spree immediately after entering 2021, clocked 5,528 units last month, thus registering a YoY growth of 264 percent (March 2020: 1,518). The MG Hector line-up with the six-and-seven- seater options in the form of the Hector Plus, as well as refreshed Hector 2021 are the top sellers for the company. It also witnessed good demand for its all-electric ZS EV crossover, which is being liked by urban travellers looking for a premium EV.
The company had also introduced its flagship product – MG Gloster – which is also being claimed to have been well received by customers. MG Motor India’s total sales in FY2021 culminated at 35,597 units (FY2020: 21,954 / +62.14%)
According to Rakesh Sidana,director – Sales, MG Motor India, “The highest monthly sales achieved in March 2021 are very encouraging with momentum continuing for our product lines. While the Hector received over 6,000 bookings during the month, the Gloster has continued its advance in the premium SUV segment. MG ZS EV’s increased traction is also being witnessed across various quarters including luxury buyers looking for a personal driving experience.”
“However, we are likely to see a disruption in the supply chain due to shortage of semiconductor chips globally as well as the the second wave of Covid. We may observe a few NPDs (no production days) in April 2021 as a preventive measure. We assure our customers that we will provide transparent communication to them throughout,” Sidana added.
Nissan Motor India: 18,884 units / 5.57%
Nissan Motor India, especially getting a new lease of life with its all-new compact crossover – the Nissan Magnite.
Introduced in December 2020, the Magnite has singlehandedly been assigned the role of reviving the dying carmaker’s fortunes in India. As per an official statement, Nissan Motor India announced clocking overall volumes of 4,012 units in March 2021 – a four-fold increase (March 2020: 825). The Magnite could be easily understood to have contributed to the chunk of these numbers.
Moreover, comparing the company’s FY2021 performance to that of FY2020, sales have marginally grown from 17,886 units to 18,884 units, registering a 5.57 percent uptick.According to Rakesh Srivastava, managing director, Nissan Motor India, “Nissan, with its transformational plan of Nissan Next, has grown by 6 percent for the year on the tremendous customer response for the all-new Nissan Magnite. Going forward into the new financial year, we look forward to maintaining this growth momentum,” said Rakesh Srivastava, Managing Director, Nissan Motor India.
Growth outlook
Although India Auto Inc, in what is an applaudable effort, has been able to claw back sales in the second half of FY2021 and emerge stronger than what was expected at the early part of the fiscal, it is still not completely out of the woods.
The Covid-19 pandemic has given birth to several associated challenges that continue to plague the industry even in 2021. Raw material prices going northwards, supply-chain constraints in terms of logistics and container shortage, semiconductor issues and the underlying fear of a second outbreak of the disease, still pose challenges ahead of the industry that it would need to circumvent to continue being on the growth trajectory going forward.