Carmakers pare dispatches ahead of festival season

Decline in sales

While passenger vehicle registrations declined 5% in September on a year-on-year basis, wholesales too moderated to account for swelling inventories at dealerships. Maruti Suzuki, the country’s largest carmaker, clocked a 148,061 units in wholesale dispatches in September, 3.3% lower than the same month last year. 

“We are focused on calibrating our dispatches to dealers and anticipate a surge in consumer demand during the festive period because our bookings and enquiries are nearly at the same level in September as last year, despite the shraadh period beginning in the middle of September this time,” Partho Banerjee, senior executive director, Maruti Suzuki, said.

However, homegrown carmaker Tata Motors said declining retail sales reflected pale consumer demand.

“The PV industry in Q2 FY25 saw more than a 5% decline in retails driven by slow consumer demand and seasonal factors. However, industry offtake has been higher than registrations in anticipation of a strong festive season,” Shailesh Chandra, managing director, Tata Motors’ passenger vehicle business, said. 

The sentiment reflects a broader industry trend as manufacturers pin hopes on a potential sales rebound during the festivities.

Maruti Suzuki reported record total sales of 1,063,000 vehicles for the first half (H1) of FY24-25, with domestic sales reaching 861,045 units. However, the company experienced a slight dip in wholesale figures in September due to a strategic recalibration of dealer dispatches. Despite this, the automaker achieved a 42.2% retail market share in September, even as the Shraadh period traditionally dampens consumer activity.

Sales of electric passenger vehicles also took a hit in September due to the lapse of registration and road tax waivers in key states, Tata Motors said. It also added that fleet electric vehicles (EV) sales have suffered due to policy changes. Maruti Suzuki, in the meantime, is banking on the growing popularity of compressed natural gas (CNG) vehicles. The company sold 53,431 CNG units in September, reflecting a 36.1% increase year-on-year.

As October approaches, Banerjee expressed optimism for the festival season. “October’s figures may rise due to Diwali and Navratri, but we must remain vigilant, as November might see a dip.”