Market Comparison – China, US, Germany and India
Global automotive industry faced one of its worst ever performances in the first half of 2020, with car sales declining in every region. This was as expected, as most part of the world was well under lockdown for at least half of H1 2020, and is still reeling under the impact of the deadly virus. Though the virus has still not left the world, most regions have re-started economic activities, and the automotive sector is a no exception.
The Indian automotive industry was already under huge stress before the lockdown, and the virus just made things worse. The story is not very different across the world. All that matters more is the recovery after the hit. We present you with some facts and figures concerning the automotive industry’s performance in H1 2020 in India and across the globe.
Speaking on recoveries, it is obvious that China is far ahead than the rest of the world, and has shown impressive performance in the months of April and May. We can notice a “Sharp V curve” in China; India and Germany are more or less similar with a “Not so sharp – V curve”. This means that though the markets are recovering, it might definitely not be at the pace at which China is recovering. The US market seems to have the widest V curve of the lot.
Facts and figures pertaining to just the Indian automotive market is shown in this section with more depth.
The comprehensive summary of total sales of each company this year is presented in the table below –
VW is the only OEM to have recorded more sales in May-June than the pre-covid times. Though their recovery is impressive, it has still not matched its own performance during 2019.
Renault is the only company to have posted positive growth YOY during the first two months of the year, comparing with the previous year.
It also appears to be fast recovering from the pandemic, and has closed the gap very much with last year’s sales volumes. But, it must also be noted that its overall volumes still remains low.
Apart from Renault, OEMs such as Skoda, MG Motors and Tata seem to have gained an almost perfect V-Curve, swiftly catching up the volumes and would soon be better off than their pre-Covid times, if the same trend is expected to continue in the forthcoming months.
Maruti, Hyundai, Kia and Toyota have achieved a “not-so-perfect V-curve”, but are steadily on their road to recovery. This is mainly because of their volumes, as together they account for more than 70% of the total car sales in the country.
Recoveries of Mahindra and Ford are similar but poor, with their curve becoming wider. It is high time the JV partners work out some strategy to come out stronger together.
Nissan, Honda and FCA seem to have missed the bus entirely, and are at the bottom of the table. Their curves are almost flat at the bottom, and whatever their strategy is – does not seem to be working. Unless there is a shift in their approach, they potentially risk getting buried in the mess caused by the pandemic.
Most OEMs appear to be on their road to recovery, some being quicker than the rest. But, in terms of volumes, the gap is large and would require a considerable amount of time to at least match the pre-covid era performance.
The Indian automotive industry, if not better, is at least on par with the global markets as far as the recovery from the impact of corona virus on the industry is concerned. It is almost certain that the total sales this entire year can definitely not match last year’s performance, but will the recovery trend continue marching upwards? We may have to wait and watch, and we hope it does.
(The article is written by Karthick. He is an auto enthusiast, and an engineer by profession, currently employed in an auto MNC at Chennai; has a craving on new tech and a particular interest on the Indian automotive market.)