Auto Sales Skid off the Road

Data for the month of October 2008 shows that the combined two wheeler and three wheeler industry volumes declined significantly by 10% Y-o-Y for the first time in FY09. Despite the festival period falling in the month of October 2008, sales at the companies’ end plunged sharply due to a huge pile up of inventory of the previous month at the dealer network, though retail sales recorded an increase.

Hero Honda (HH) – Decline in domestic volumes of entry-level Motorcycle segment (75-125cc) pull down overall volumes. Motorcycle sales were down 4.9% Y-o-Y and 10% sequentially to 335,754 units. Scooter sales witnessed a growth of 38% Y-o-Y to 16,695 units.

Bajaj Auto’s overall volumes declined sharply by 31% Y-o-Y and 21.8% sequentially to 191,840 units, due to a significant decline of 47.6% Y-o-Y in domestic sales to 116,748 units in October 2008. The company’s overall Motorcycles volumes plunged 34% Y-o-Y to 163,850 units, aided by the export growth of 42.3% Y-o-Y to 61,608 units.

TVS’s total volumes for October 2008 declined 9.7% Y-o-Y and 14.7% sequentially to 117,101 units. The company’s Motorcycle sales fell 11% Yo-Y to 60,273 units.