Gloom or Boom?

It's that time of the year when festivities drive a major chunk of sales in the consumer durable segment. So much so that the auto sector in specific dolls out special schemes and offers just to attract perspective clients to buy their products. The most recent ones being General Motors and Hyundai motors offering discounts on the eve of 66th Independence Day. From that perspective, this is good news for the end consumer but the irony is that considering the kind initiatives that manufacturers are taking into their stride to provide these mouth watering deals has had a negative impact on overall sales of products. As per a recent SIAM report, the total number of passenger, commercial, three wheeler and two wheeler vehicles produced for the month of July 2013 stood at1,729,002 vehicles as against previous year's figure of 1,745,532 for the same month. This indicates that the overall auto sector has seen a decline of 0.95 percent in sales when compared with last year.

Speaking off overall domestic sales( April - July 2013), it too has declined by 2.09 percent in comparison to last year. In a more comprehensive break-up, the total sale of passenger vehicles has done down by 7.49 percent for the months of April - July 2013. When further sub divided, sale of passenger cars stood at a negative 9.73 percent while utility vehicles experienced a decline off 1.03 percent with vans recording (-) 2.30 percent during April - July 2013. Moreover, the domestic sales of Utility vehicles (UVs) too registered a negative growth for the first time since May 2009 this July. While the domestic sales of UVs declined for the first time in 50 months, exports increased by almost six fold or 600%, thanks to Ford EcoSport and Renault Duster.

As for exports, during the same period the overall figure went down by 3.37 percent however in regards to passenger cars; the industry has seen a positive growth of 2.39 percent which is some good news for manufacturers as they stand to benefit a bit out off this scenario keeping in mind the foreign revenue being pumped into the India economy. In the end a negative sales report is a matter of concern to any manufacturer who is currently just about managing to make their prominence felt in the Indian auto space with the consumer being given an added advantage in terms of discounts and exchange bonuses.