The Indian automotive market has not been on fire quite literally, but a 'double digit' growth of 13.42 per cent in the April-June quarter has been quite impressive, fuelled by the incessant demand for scooters, SUVs and three wheelers.
According to data released by Society of Indian Automobile Manufacturers (SIAM), scooters grew 27.12 per cent for the quarter to reach record sales of 1.37 million units. Also, utility vehicles mainly comprising SUV & MPV models, posted its best sales of 176,788 units, a growth of 38 per cent over last year.
SIAM Director General Vishnu Mathur told reporters in Delhi on Monday, "Customers are showing preference for utility vehicles now. The emergence of the compact SUV segment is changing the pattern of sales growth in PV segment. While we are witnessing small growth in passenger car sales, the utility vehicle (UV) sales are seeing very high growth."
The automotive industry seems to be on the recovery path for the past few months with consistent demand for small-ticket consumer products like two wheelers and compact cars. Also, there is consistently strong demand for medium to heavy commercial vehicles that grew 18 per cent in Q1 largely on the rise in road and infrastructure activity.
The industry body said that the government's push for development activities across sectors is expected to take the automotive sector on a high growth path. It said that the economic growth with improvements seen on the demand front and a low CPI inflation that is likely to remain below 6 per cent and upswing in the industrial activity could bring cheer to the industry.
Also, the implementation of the 7th Pay Commission is expected to ideally propel demand for consumer items like two-wheelers and cars across India.
The industry, however, witnessed some dampeners in June when car sales declined by 5.18 per cent on the back of lower production by market leader Maruti Suzuki. It suffered a loss of almost 30,000 units last month on account of a major fire in its key supplier Subros's factory that supplies air-conditioning for its vehicles.
Overall, the passenger vehicles that also comprises of SUV and MUV's grew 2.68 per cent on robust demand for models like Maruti Suzuki's Vitara Brezza and Hyundai's Creta. This segment grew 35.24 per cent to 55,852 units as against 41,278 units in the same month last year. Companies like Totoya Kirloskar Motor's posted a 64.15 per cent jump in its newly launched Innova Crysta multi-purpose vehicle sales to 9,099 units last month.
Two-wheeler sales registered a growth at 14.26 per cent during April-June 2016 over April-June 2015. Within the two wheelers segment, scooters and motorcycles grew by 27.12 per cent and 8.87 per cent while the comparatively smaller mopeds grew 18.33 per cent in the April-June 2016 period.
The three-wheeler segment grew by an impressive 23.39 per cent in April-June 2016, while the overall commercial vehicles growth was led by medium and heavy vehicles with 14.49 per cent growth, while the lighter trucks market grew at 11.91 per cent.