3W Exports was almost 3 times the domestic sales in H1 FY2021!

Around 58,662 three wheelers were sold in the Indian market in the first half of FY2021; while the export volumes was 1,52,772 units in the same period.

However; both Domestic Sales and Exports saw a double digit degrowth owing to Covid19 pandemic. The bigger dip was seen in the domestic volumes due to the inherent slowdown and the increasing acceptance of electric 3 wheelers.

India is undoubtedly the largest market for three-wheeler vehicles in terms of both sales and production across the globe. 3 wheelers remained to be an affordable means of short-to-medium public transportation and last mile connectivity for goods transportation. The significance was well identified by Taxi Aggregators (Ola, etc) and have added autos as well under their offering. However; the segment has seen a tremendous decline in the past 2 years and a lot is dependent on export volumes too. In FY2020; the domestic sales was almost equivalent to that of exports (source). But in FY2021; the exports numbers almost tripled to that of the domestic sales!

Three Wheelers Domestic Sales Statistics for Apr to Sep 2020 – 

  • The segment has seen a unprecedented dip! The volumes dropped by -82% YoY and is the highest in the overall Automobile Industry!
  • Bajaj & Mahindra emerged as the biggest losers and recorded the highest Market Share drop as well.
  • With only 11 units sold in the past 6 months; Scooters India faces threat of extinction now.
  • Piaggio YoY drop was -73%. However; the OEM recorded the highest Market Share gain .




Three Wheelers Exports Statistics for Apr to Sep 2020 – 

  • While Bajaj lost tremendously in domestic sales; it has shifted focus largely in exports. It degrew -35% YoY against industry average of -40%. It was able to strengthen its exports market share to 67% in H1 FY21 (from 61% in H1 FY20).
  • TVS & Piaggio lost significantly in exports and both OEMs recorded drop in Market Share of -2.3% & -3.3% respectively .

Segment wise Sales Analysis – 2020 (January to September)

As expected; SUVs was the best performing segment and recorded the lowest YoY fall. Also Sedans registered the highest dip.

  • SUV/Crossovers have shown quick revival and gained market share
  • Largely helped by Hyundai Creta, KIA Seltos and Tata Nexon
  • Hatchback too had gained market share due to pent up demand
  • MUV segment is largely stable due to strong performance by Ertiga+XL6 and Renault Triber
  • Sedan suffered massively across the sub segments

Electric Passenger Cars Performance – 

  • Entry of Tata Nexon and MG eZS has changed the dynamics of EV landscape in 2020
  • Improved technology and SUV/Crossover silhouette is winning customer with its own charm

OEM Performance Analysis – CY2020 (January to September)

We present a detailed Manufacturer wise performance analysis in this post basis their sales volumes in CY2020 (Jan to Sep).

Maruti and Hyundai have strongly maintained their market share





Race for #3 position

  • Given the current product and future pipeline, race for #3 position is between KIA, Mahindra and Tata

Tata Motors

  • With highly updated (Harrier, Nexon, Tiago & Tigor) and new (Altroz) products, Tata took strong lead in factory dispatches before prime festive season in India
  • Interesting to see the sustainability of high wholesale figures in coming months

Mahindra

  • Mahindra has lost the plot in 2020 due to slow introduction of BS6 engines in market





Honda

  • Honda too is struggling in absence of right SUV portfolio

Toyota

  • Toyota has lost volume, as, Innova and Fortuner sales is taking time to pickup
  • Glanza is filling in the void created by Etios twins and Corolla

Renault

  • New Product like Triber is adding volume to Renault’s kitty
  • Dated Duster with petrol only engine could not find many customers in BS6 age
  • Performance of facelifted Kwid too is subdued

Best Selling Cars Analysis – 2020 (January to September)

The Top 10 cars sold in 2020 (Jan to Sep) contributed to over 52% of the cars sold in the Indian market! It had 7 models from Maruti+Nexa, 2 from Hyundai & 1 from Kia.

List of Top 10 cars sold in 2020 –

Rank OEM Model CY2020 CY2019 YoY
1 Maruti Alto 1,02,765 1,59,609 -35.6%
2 Maruti Swift 99,547 1,38,437 -28.1%
3 Maruti Baleno 96,113 1,31,114 -26.7%
4 Maruti Wagon R 95,655 1,16,177 -17.7%
5 Maruti Dzire 79,890 1,46,390 -45.4%
6 Kia Seltos 73,219 13,990 423.4%
7 Maruti Ertiga+XL6 68,788 77,893 -11.7%
8 Maruti Eeco 63,773 86,298 -26.1%
9 Hyundai Creta 60,357 79,070 -23.7%
10 Hyundai Grand i10 56,728 75,036 -24.4%
  • Alto continues to be India’s best selling car. However; Swift is just 3,218 units behind Alto and is closely following Alto’s lead.
  • Baleno too has jumped rankings impressively and sold almost equivalent units to that of Swift! If you include Glanza’s volumes – It would have been India’s No.1 Selling car! (Baleno-96,113 units + Glanza-13,168 units = 1,09,281 units)
  • Kia’s Seltos was the only Non-Maruti in the Top 6.




Top 30 Products in 2020 (January-September)

  • Those who migrated to shared mobility service (read – Ola/Uber/Meru), earlier, in Metros, have found themselves largely stranded in absence personal mobility during lockdown
  • Many of them, who can afford to buy car, seems to be buying new or used cars post lockdown
  • High volume of Swift, Baleno and Wagon R, which is quite close to Alto’s volume, seems to reflect trend of pent up demand
  • Thus entry level hatchback have lesser volume compared to slightly premium ones
  • Incidentally sub-4m SUV don’t have volume advantage over KIA Seltos and Hyundai Creta
  • In absence of diesel engine Maruti Dzire (41% mix in 2019) and Vitara Brezza has suffered tremendous volume losses
  • Maruti S Presso seems to be not so quite well accepted in the market, even 7 year old Hyundai i20 is doing better
  • Hyundai Santro’s second innings is not so successful anymore
  • Tata’s updated Tiago, Nexon and all new Altroz are doing quite well

Market Share of Top 30

Body Style of Top 30

Indian Passenger Car Market Analysis – 2020 (January – September)

Slowing GDP growth has caused massive de-growth of passenger car sales in 2019 (source). This have been compounded in 2020 by country wide lockdown, introduced, in late March 2020, to check the spread of Covid-19 induced pandemic. Strict lockdown has brought demand – supply system to near standstill in April 2020.

GDP in second quarter of 2020 crashed by 23.9%. Consequently passenger vehicles sales, too, has declined by 29% in 2020 (January-September), compared to same period last year.





Pent-up demand [Source: Investopedia]

  • Pent up demand describes a rapid increase in demand for a service or product, usually following a period of subdued spending
  • Consumers tend to hold off making purchases during a recession, building up a backlog of demand that is unleashed when signs of recovery emerge
  • Quite often, pent up demand accelerates the economic recovery period immediately following an economic downturn
Is a V-shaped recovery in sight? And can it sustain?
  • Wholesale volume is increasing sequentially with easing of lock down
  • Still it cannot be construed as full recovery, as average sales since April, is still much low – at 1,70,167 units
  • It seems demand backlog from April and May is getting fulfilled now
  • OEMs need to be little cautious over sustainability of pent up demand post festive season
  • Because extent of damage done by GDP crash in 2nd quarter of 2020, to unorganized sector, is still unknown
  • This may have cascading effect on growth recovery in coming years