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- Two wheeler sales were robust in January with top players seeing over 20% growth in sales volume.
- Passenger vehicles sales went up in the mid teens, with sales tilting towards utility vehicles.
- Commercial vehicle sales fell marginally, but tractor sales declined sharply.
Indians kept up with their love for cars and bikes in the month of January, but tractor sales showed a sharp fall, indicating extended pain in the rural markets.
Passenger vehicles sales went up in the mid teens, with sales tilting towards utility vehicles. “As per our estimates, domestic PV industry wholesale volumes increased low teens YoY driven channel filling whereas retail sales grew single digit during the month,” said a report Kotak Institutional Equities.
The country’s largest automaker Maruti Suzuki posted a robust 16% sales volume even as its mini portfolio of Alto and S Presso fell 37%. Its utility vehicle portfolio sales doubled as compared to January 2023, indicating a shift in consumer preferences. Hyundai Motors reported 14% growth whereas Toyota witnessed strong growth of 92% on a YoY basis in January.
Tractor sales slump
Tata Motors too showed the same pattern as its total auto sales went up 6%, with commercial vehicle (CV) sales falling around 2%. Even VE Commercial Vehicles saw its CV volumes slip 2%.
Mahindra and Mahindra too posted 15% sales growth on the back of its robust UV sales, even as its tractor sales declined 17%. Ashok Leyland and Escorts also saw tractor sales decline 7% each.
“Domestic tractor industry volumes saw a low-teen decline owing to tapering of agriculture activities led a delayed harvesting season and lower rabi sowing. Announcement of higher horticulture production, government support and improved Rabi sowing will support demand recovery in coming months,” opines Kotak.
January auto sales
| Company | January sales | YoY change |
| Maruti Suzuki | 199,364 | 16% |
| Mahindra & Mahindra | 97,892 | 15% |
| Tata Motors | 86,125 | 6% |
| TVS Motor | 339,513 | 23% |
| Bajaj | 356,010 | 25% |
| Hero Moto Corp | 433,598 | 21.6% |
| Escorts Kubota | 6,185 | -7% |
| Ashok Leyland | 15,939 | -7% |
| VE Commercial Vehicles | 7,066 | -2% |
Source: Kotak report
Two wheelers: Off to a flying start
Steady demand, a favourable base has pushed two-wheeler sales of most players, even as exports remained tepid during the month. All the three listed players – Hero, Bajaj and TVS’ sales grew over 20% during the month.
As per a report Jefferies, two wheeler sales will outpace that of passenger vehicles in 2024, due to pent-up demand. The sales of two wheelers which have been lagging behind passenger vehicles (PVs) for the last three years; are expected to catch up.
It expects two wheelers sales to grow at 15% compounded annual growth rate (CAGR) over the next two years, while passenger vehicles and trucks are expected to grow at 7-8% CAGR. PVs on the other hand, which showed robust growth for the last two years, will grow albeit at a lower pace.
“Compared to the respective FY19 peaks, FY23 volumes were 23% lower for 2Ws but 15% higher for PVs,” said Jefferies.
In 2023, 2Ws started charting their recovery, and grew at 9.5% as compared to 11% growth seen in PVs, as per data Federation of Automobile Dealers Associations (FADA). New model launches as well as lower fuel prices and crop payments can also aid growth, the association said in its 2024 outlook.