Maruti Suzuki India, which sells every second car in the domestic market, expects production and sales to grow between 4 and 8 per cent for the financial year started in April.
“There are unfavourable factors that might impact growth in the next financial year. There is a downturn in the overall industry, uncertainty over petrol prices (due to the embargo on Iran), and a shift to the BS VI model, due to which prices will go up. However, there are favourable indications too,” Maruti Suzuki Chairman R C Bhargava said.
Maruti’s exports in May were down 2.4 per cent at 9,089 units against 9,312 units in the corresponding month last year, the company said. Honda Cars India, the Indian subsidiary of Japanese carmaker Honda sold 11,442 units in May, recording a decline of 28 per cent compared to 15,864 units in the corresponding period last year.
“The market continues to be tough for the auto industry with two consecutive months of such a high de-growth. It is unprecedented in the last two decades. After elections, we were expecting an upswing which has not yet come. Factors like liquidity that is affecting capital to auto sector along with increase in fuel prices have remained a challenge to revive consumer sentiments," said Rajesh Goel, senior Vice President and Director (Sales and Marketing) at Honda Cars India.
Toyota Kirloskar Motor sold 12,138 units in May 2019, which was a de-growth of 7 per cent as compared to the same period last year.
Similarly, Mahindra & Mahindra reported a 17 per cent drop in tractor sales, signalling that a distress in rural economy continues. Domestic tractor sales fell 17 per cent to 23,539 units. “While consumer sentiment and demand continued to be subdued during the pre-election phase, our focus has been on correcting the channel inventory,” Rajan Wadhera, president of Automotive Sector said.