India's largest passenger vehicle maker Maruti Suzuki India Ltd's July sales (year-on-year) slumped 36.3% to 98,210 units. The company sold 154,150 units in the corresponding month last year.
Owing to the continued economic slowdown, tightening of credit rules by financial institutions and a high base effect of the first half of the last fiscal, the carmaker has witnessed the sharpest drop in its sales in the last two decades.
Maruti sold 1.09 lakh units in July 2019, which is the lowest as compared to the last two years' numbers, a fall of 33.5% as compared to 1.64 lakh units sold in the same period in 2018.
Where the sales in the Alto, Old WagonR category showed a 69.3% fall year-on-year, the compact category of New WagonR, Ignis, Baleno and Swift logged a 23% year-on-year slump in July 2019. The sales of utility vehicle part also dropped 38.1%.
However, it was only the light commercial vehicle segment that clocked a half a percent growth. The category sells Super Carry mini-truck in India.
The carmaker's domestic vehicle sales also declined more than 19% to 374,481 units in the June quarter. This is the steepest fall since the third quarter of 2000-01. Domestic sales in July 2019 plunged 35.1% at 1 lakh units and passenger car sales dipped 36.2% to 71,486 units when compared to July 2018.
Maruti's total exports also fell 9.4% year-on-year to 9,258 units in the month of July.
The carmaker had last week reported a 27.3 per cent year-on-year decline in its net profit at Rs 1,435.50 crore for the first quarter ended June 30, 2019, dented by lower sales volume and higher depreciation expenses.
"The auto major had posted a net profit of Rs 1,975.30 crore in the same quarter last year," Maruti Suzuki India said in a filing to the Bombay Stock Exchange.
The company said that the first-quarter earnings were impacted by negative factors, such as higher depreciation expense, lower capacity utilisation, adverse commodity prices and higher sales promotion expense.
Despite the fall in sales for the July month, shares of Maruti Suzuki closed at a advance of 101.95 points or 1.86% to Rs 5574.10 on BSE.