New Car Launches Aid Carmakers To Sustain Growth In December 2018

Carmakers in India are still recovering from the hit which car sales took from several headwinds in 2018. Automakers have been witnessing sluggish demand for the last four months which is been due to factors like rising fuel prices, onetime payment of insurance premium and a rise in interest rates. India's largest carmaker- Maruti Suzuki has recorded a marginal volume growth of 1 per cent in December 2018 selling 119,804 units of passenger vehicles against 118,560 Units in the same month last year. The growth was largely sustained by the Utility Vehicle (UV) segment as the Vitara Brezza continued to perform well. New models- the recently launched 2018 Maruti Suzuki Ertiga and 2018 Ciaz too remained in Demand. However, the mini and compact car segment which together constitutes a huge chunk of volumes witnessed muted sales which in-turn had a significant impact on volumes.

The 2018 Santro has been one the key volume drivers for Hyundai since its launch.

Also Read: Maruti Suzuki Sales Grow Marginally In December 2018

However, India's second largest carmaker- Hyundai Motor posted a decent growth of 4.8 per cent in December 2018 selling 42,093 units as compared to 40,158 units it sold in December 2017. Even for Hyundai, the growth came from models which were launched in 2018- the Hyundai Creta, Hyundai i20 Elite Facelift and the 2018 Hyundai Santro. Home-grown UV maker- Mahindra has witnessed a slump in volumes selling 15,091 units of passenger vehicles in December 2018 compared to 15,543 units it sold in December 2017 witnessing a de-growth of 3 per cent. Tata Motors too remained sluggish growing marginally by 1 per cent at 14,260 units in December 2018 against 14,180 units in the same month last year. The Tiago and Nexon continued to be the volume driver for Tata Motors, thereby retaining the growth.

Along with the popular Ford Ecosport, new launches like the 2018 Ford Freestyle has helped Ford India to gain momentum.

Also Read: Hyundai India Sells Over 7 Lakh Cars In 2018, December Sales Up By 4.8 Percent

In spite of the headwinds, it's the Japanese carmakers such as Honda Cars and Toyota Kirloskar Motor which have performed rather well in December. Honda car India riding the back of the 2018 Honda Amaze has recorded a growth of 4 per cent selling 13,139 units in December 2018 against 12,642 units which it sold in December 2017. Toyota Kirloskar Motor also has recorded a healthy growth of 10 per cent selling 11,830 units in December 2018 as compared to 10, 793 units which were sold in the same month last year. At the same time, Ford India has surprised us by recording its highest ever domestic sales of the calendar year 2018 in December. The American carmaker sold 5840 units in December 2018 against 5087 units which is an uptick of 14.8 per cent. Even for Ford India new launches like the Freestyle and 2018 Aspire remains one of the volume drivers along with the popular 2017 Ford Ecosport.

Also Read: Ford India Domestic Sales Up By 15% In December 2018

Almost all major carmakers have made price hike announcements as a part of cyclical revision which happens primarily due to rising input costs. The price hike has been effective from January 1, 2019 and will affect the entire product line-up. It in-turn may hurt sales further as it will exert a negative influence on customer sentiments which were already saddened due to various disruptions in the economy about which we spoke initially.