Q1 2019 Analysis – Passenger Vehicles

Q1 of 2019 has seen de-growth in comparison to same period in 2018. A weak consumer sentiment in an election year is reflecting heavily in Q1 of 2019, in otherwise growing PV market. Also, retail fuel price is very much at 2014 level, in fact, much higher for diesel. Illustration below shows how retail fuel price and interest rate on car loan has huge bearing on consumer sentiments and PV industry growth.





Industry Players

Every car maker is suffering, except for those who have had successful new launches, further helped by lower base effect.





Body Style

SUV segment which has shown strong growth momentum in recent past, too, is struggling now. Surprisingly, it’s the MUV segment which fared quite well.





Top 30 Models in Q1 2019:

(The article is written by Rohan Rishi. You can connect with him at emailrohanrishi@gmail.com)

FY19 Sales Analysis – Two Wheelers

While double digit growth was expected for the Two Wheeler Industry in FY19; the growth was stunted to 5% owing to Increased Insurance Prices, Fuel Price Volatility, Negative Market Sentiments & Declining Scooter Segment. Scooters which was strongly becoming integral for every household; saw a tremendous fall in terms of the overall acceptance and the model which was largely affected was the Activa. Both Honda & Activa’s volumes fell by ~5% in FY19 v/s FY18. In overall; near to 2 Crore 11 Lakh Two Wheelers were sold in the Indian Market in the previous financial year!



A look at YoY Growth of the Two Wheeler OEMs and the Industry –

  • In overall; near to 2 Crore 12 Lakh Two Wheelers were sold in the Indian Market in the previous financial year!
  • Hero retained its No.1 Spot by quite a margin and commanded a Market Share of 36% in FY19. However; Hero’s Market Share dipped by -0.61% in FY19 vis-a-vis FY18.
  • Honda’s plan of nearing Hero’s volumes faltered in FY19 and rather the gap between the two OEMs widened. Hero sold >20 Lakh units more than Honda in FY19! Honda also saw the steepest fall in Market Share and it dipped by -3% in Fy19 (FY19 MS – 26% & FY18 MS – 29%).
  • Bajaj & Suzuki emerged as the outliers in the overall business scenario and posted a growth of 28.7% & 33.4% respectively.
  • Yamaha was only 591 units short of Royal Enfield! The gap has minimized now and going by the trend; Yamaha may soon replace Royal Enfield as the No.5 OEM. RE’s struggle was visible throughout FY19 and the only silver lining for RE was the launch of the Twins. However; Jawa may pose even bigger challenge in FY20.



Model-wise Sales Figures –








Top 10 selling Two Wheelers of March 2019

You may be thinking on why are we publishing a separate post on the Top 10 selling Two Wheelers of Mar’19 first and not the modelwise sales figures? The primary reasons are –

  • The Top 10 selling Two Wheelers sold a combine 9,48,272 units out of the overall 14,40,663 units of Two Wheelers sold in Mar’19! The Top 10 contributed ~66% of the overall 2-wheelers sold in the country.
  • The Top 3 two wheelers contributed to ~38% of the overall Two Wheeler sales!
  • The Numero Uno selling Two Wheeler Splendor recorded a sales of 2,46,656 units in Mar’19; which was almost same as the overall sales of the No.2 Two Wheeler OEM (TVS)!
  • A record fall in scooters sales seen. Activa’s YoY degrowth was a magnanimous -29%. To add to the misery, Activa was the only Honda model in the Top 10 list!
  • Bajaj’s strategy to focus on only bikes has worked a charm for the OEM. The revision in prices has paid off really well and the sales of Pulsar almost tripled & Platina almost doubled!
  • No Royal Enfield Classic in the Top 10 list? The decelerating sales of RE models (except the 650 Twins) have become a sore point for the legendary bike maker. And this is the scenario when the Jawa supply has still not taken off – what shall happen once Mahindra starts shipping Jawa bikes in full swing?




A look at the Top 10 selling models –

  • Apart from Pulsar, Platina & Access no other model registered a positive growth.
  • The overall sales of Top 10 models dipped -9% in Mar’19 v/s Mar’18.
  • Passion sales seems to be struggling and has almost halved. Platina effect?
  • Access emerges to be the dark horse and has almost matched Jupiter’s sales. The fight for No.2 scooter spot intensifies!








Offers / Discounts for April 2019

Maruti Suzuki:





NEXA:





Hyundai:





Tata Motors:





Mahindra:





Honda Cars:





Toyota:





Ford:





Renault:





Nissan:





Datsun:





Volkswagen:








March 2019 Two Wheeler Sales – Snapshot

Two Wheeler Industry registered its steepest fall of FY19 in Mar’19 and recorded a de-growth of -17.3%! The effort of OEMs to rationalize the dealership stock was clearly visible. The Industry was also marred lower consumer sentiment, increased insurance premium and shrinking ‘scooter’ segment. As a matter of fact, the scooter sales declined for the first time in the last one decade! The decline in scooter sales largely affected Honda’s sales and the YoY drop for the Japanese major was -47%!



A look at YoY Growth of the Two Wheeler OEMs and the Industry –

  • The Top 3 OEMs recorded a fall in terms of YoY sales!
  • TVS overtook Honda’s volumes in Mar’19. This was nothing less of a shocker and no one would have anticipated that Honda’s volume could drop to this extent!
  • Bajaj, Yamaha & Suzuki reported a positive YoY growth. Bajaj was the most successful mass market bike maker in FY19 and Mar’19 too was a positive month for the Indian OEM.
  • Suzuki overtook Royal Enfield in Mar’19! Royal Enfield is continuously experiencing drop in the volumes and FY19 has been an extremely tough year. RE was the 5th biggest Two Wheeler OEM in Mar’18 – It’s ranked dropped to 7th in Mar’19!
  • Mahindra 2 Wheelers sales dropped -51.2%! Have they still not started shipping the Jawa bikes in full swing? The delay is just adding to the owes of the customers who’d have booked the Jawa.








Comprehensive FY19 Sales Analysis – Passenger Vehicles

At the end of financial year 2018-19 (FY19); we thought of deeply analyzing the Indian Automotive scene and assess the segment-wise performance of the offerings in the Indian market. FY19 was an extremely tough year for the Auto Industry and it grew a feeble 2.7% YoY in this fiscal year v/s FY18. Majority of the OEMs reported a negative growth and increased discount outflow hampered their bottomlines even more badly. Similar condition seen at the channel partners end as well where they carried an all time high stock with mounting expenses. The scenario doesn’t look much better this year too where SIAM has projected a single digit growth forecast (3% to 5%) for FY20 owing to rise in commodity price, election, below normal monsoon, BS 6 norms and fluctuating interest rates. However the influx of new OEMs (Kia/MG) in this FY could give some required boost to renew the consumer interest and catapult the growth levels as well.

Let’s look at the modelwise performance (FY19 v/s FY18) –





Top 25 selling models for FY19 –

So you may be thinking which segments actually in previous Financial Year? We shall try and answer the question with the mentioned stats –

Entry-Hatchback Segment: 

  • Apart from Alto; all other models reported heavy fall in volumes. The overall segment grew a phenomenal -15% in FY19 v/s FY18
  • Nano and Eon also saw their exit from the Indian market this year. The Industry has gone through a major transitional phase and the Indian Market which was once considered a hatchback dominated market is slowly upgrading to other segments.
  • We doubt if any OEM shall even try to launch a new model in this segment. In long run, Alto shall be the only contender here! Hope, Renault could work some magic on refreshing the Kwid and give it a fresh lease of life to rightfully compete with Alto.




Compact-Hatchback Segment:

  • The segment saw a positive growth of 6% owing to launch of new model (Santro) and refreshed avatars of Swift, Wagon-R. However; the point to note is that out of 14 offerings on sale in the segment in FY19; 9 models reported a decline in sales! It again came as a tricky segment for the OEMs and apart from few established marques; no other models is faring well.
  • Santro too was expected to sell much better; but the model failed to meet the expectations. Even; the late launch of refreshed Wagon-R resulted in decline of volumes for the model.




Premium Hatchback:

  • Baleno & i20 have been doing excellent in the segment and both have continuously listed themselves in the Top 10 selling cars this year.
  • Baleno has been giving tough competition to its sibling Swift and the volume difference between them was a mere ~11k units in this FY. Seeing the trend; we anticipate Baleno to outsell Swift in FY20!
  • Freestyle gave Ford the required volume boost in the absence of Figo. It was successful to overtake both Polo & Jazz in terms of FY19 volumes basis aggressive pricing and cross-avatar.
  • Both Polo & Jazz struggled in FY19. Jazz volumes almost halved in FY19 when compared to FY18!




Compact Sedan:

  • Amaze proved be a savior for both Honda and Compact Sedan segment in FY19! The model was one of the most successful launches of previous FY and in a way revived the segment. Compact Sedan sales shot up 13% and Amaze was single handedly responsible for the double digit growth!
  • Apart from Dzire & Amaze; all models reported a decline in volumes. Compact Sedans have always been compromised models (elevated hatchbacks) to fall under the sub-4m category. The consumers are not particularly happy with the compromise and has reflected in the sales of the offerings in the segment.




Executive Sedan:

  • The segment reported a double digit de-growth in FY19 and apart from Verna all other models saw a decline in the sales.
  • Toyota entered the segment after a lot of anticipation with the Yaris. However; even Toyota failed miserably to make its presence felt in the segment and now the competition lies between Ciaz, City & Verna only!




Premium Sedan:

  • ‘A dying segment’ – would be the apt words to describe the volumes here. However; Honda swam against the tide and launched a model in the segment this financial year. And the result was surprisingly good – Civic’s single month’s sales was almost twice of Elantra’s volumes for the entire FY!
  • Will be interesting to see if Civic could woo the buyers continuously and help the segment stay afloat. All other models in the segment have been struggling to garner a sale of even >300 units/mth! Even adding Civic’s volumes; the segment degrew -7% in FY19 v/s FY18.




Luxury Sedan:

  • We have termed these models as luxury sedans as they cost almost similar to the Luxury OEM offerings! However; the segment is losing its sheen and the sales of these models are even lower than the luxury OEM models sales.




Compact SUV:

  • The segment grew a positive 6% in FY19 v/s FY19. Brezza volumes have been a matter of envy and all OEMs are rushing to grab a pie in the segment. Mahindra launched the XUV300 & now Hyundai is planning to place its ‘Venue’ in the segment.
  • WRV & TUV300 lost heavily and reported a degrowth of -31% & -33% respectively. It clearly highlights that the Indian consumers are extremely demanding and shall not allow any compromises in the vehicle they chose!




Mid SUV:

  • Mid SUV has caught the fancy of new OEMs primarily due to the sudden shift of consumers preference towards bigger SUVs. It is also important to note that the OEMs expenditure on bringing a new model (either SUV/Sedan/Hatchback) is the same; however the margins that the OEMs would make in the SUVs would be comparatively much higher! Hence; it is financially attractive too for launching a SUV.
  • Creta was undoubted leader in the segment and sold almost equal to Grand i10 volumes! Creta ranked 9th in the Top selling vehicles list and the performance was nothing short of a blockbuster!
  • Even Tata & Nissan have tried to make a mark with the Harrier & Kicks in the segment.




Premium SUV:

  • Saw launches from M&M (Alturas) & Honda (New CR-V) in FY19. But; the segment saw a decline in overall sales. Even the mighty Fortuner & Endeavour reported a double digit fall in volumes.




Lifestyle Offroader:

  • With stringent upcoming Emission and CAFE norms; the models in this segment are either going for a makeover or an upgrade.
  • Gypsy saw the end of production this year and hopefully should be replaced by Jimny. Even M&M is working on an updated Thar whose launch is due in FY20.




Vans:

  • Vans reported the highest growth comparatively among all segments! Only Maruti models are in sale in this segment and clearly shows why Maruti is a market leader in India!
  • If you add Omni+Eeco sales for FY19; the numbers are almost equal to Honda Cars India volumes for FY19. Do not understand why no other OEM is even bothering to enter this segment.








FY19 Car Sales – Snapshot

The Passenger Car Sales grew  a meager 2.8% in FY19 (Apr’18-Mar’19) v/s FY18 (Apr’17-Mar’18). We had anticipated a growth of over 6% in this financial year; but the growth forecasts were dropped by >50% citing the falling demand, increasing interest rates and liquidity crunch. Not to forget the other deterrents which hampered the growth plans – Kerala Floods, Volatile Fuel costs and increasing Insurance costs. Even the channel partners (Car Dealers) saw their worst phase in the business where almost all brands were carrying excessive stocks.



Let us see the YoY performance comparison of the OEMs –

  • Interesting to see that the Top 7 OEMs posted a positive growth in FY19 v/s FY18 and remaining all 5 OEMs registered a YoY de-growth!
  • While Tata posted the highest growth amongst all OEMs; It was Nissan+Datsun which seems to lost the track completely. It not only saw a slump of ~31% in terms of volumes; the new launch ‘Kicks’ too isn’t performing as per expectations.
  • Do note that Tata was the only OEM to register a double digit growth in FY19! Surprisingly Tata achieved this feat with only 1 new model Harrier which launched in this timeframe (that too at the fag end of the financial year). It is nice to see that Tata is not only focusing on new model launches; but equal significance is given to elevate their existing portfolio sales.
  • The growth for the Market Leader Maruti was supported by the Arena channel (6% YoY). Nexa struggled in previous FY and the sole dependence on Baleno is now showing up.
  • Hyundai could post a flat growth (2%) and this too was possible with the introduction of the iconic Santro. However Santro wasn’t exactly a successful launch; Hyundai is pinning its hopes on the launch of the Compact-SUV Venue to gain volumes this year.
  • Even with 2 new models launched this year (Marazzo & XUV300); Mahindra’s YoY growth was mere 1%!
  • Honda grew a healthy 8% in FY19 owing to the tremendous success of New Amaze. With no new models in pipeline this year; it looks to be a difficult year for the Japanese major.

In terms of Market Share; Maruti gained the most! Maruti Suzuki’s Market Share increase by 1.2% in FY19 and the Market Leader could capture a Market Share of whopping 51.9% in the Indian market! Can the likes of Kia, MG & Citroen really challenge Maruti’s success run in India? Only time shall tell.








Top 10 Selling Cars of Mar’19!

The Top 10 selling cars sold a total of 1,43,896 units in Mar’18 and contributed to >50% of overall car sales in India! And 8 out of the Top 10 cars were from Maruti’s stable.



  • Maruti’s most ‘Dzire’able car tops the chart and sells ~20k units in Mar’19. Dzire is now continuously ruling the chart and looks to stay here for a while.
  • Baleno ranks second and sells >17k units in Mar’19. The Nexa’s blue eyed boy contributed to >65% of Nexa’s volumes in India.
  • Alto is pushed to third rank and shows signs of ageing now. The entry-hatch volumes are draining down and 2 models mark their exit in FY19! (Nano & Eon). The performance of the models in the segment is as shown –

  • The New Wagon R is working the trick and crossed 16k units after 11 months. The Tall Boy ranked 4th in the list.
  • Dzire’s younger sibling Swift could only cross 14k units and stood fifth in the ranking table. Sixth Ranked Brezza was just 37 units short of Swift.
  • i20 was Hyundai’s best seller for Mar’19 and sold over 12k units. Hyundai’s second best seller was Creta – Grand i10 now moves out of the Top 10! Maybe a refreshed avatar of Grand i10 is on the cards?