Auto July 2018 sales review – CVs, tractors, 2-wheelers continue to ride well

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26 Aug, 2025 12:21

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Nitin AgrawalMoneycontrol Research

Auto players clocked strong sales volume in July 2018 with robust performance in all segments except the passenger car segment. Major OEMs, with the exception of Maruti, Eicher Motors, and Hero MotoCorp, reported double-digit growth.

Factors such as an expectation of good monsoons, improved rural sentiments and investment in infrastructure led to strong demand for commercial vehicle (CV) and tractors segments. The growth is coming despite hiccups like the new axle load norms that stand to improve the load carrying capacity of vehicles. Revival in three-wheeler sales is due to government’s decision to end permit raj. Export markets also continue to do well.

The CV and tractor segments should have a strong run going forward on the back of focus on the rural economy in an election year and the continued investment in infrastructure. The stronger numbers from two-wheeler is also a strong trend, which on the back of the revival of the rural economy may strengthen further.

Commercial Vehicle – Strong show

Despite the new axle load norms, the CV sector continues to be buoyant on the back of increasing focus on infrastructure, demand from construction and increase in mining activities. We believe the new axle load norms may lead to deferment of purchases. As per industry experts, the impact would not be substantial.

Notably, LCV (Light Commercial Vehicle) segment has also started showing a strong uptrend in monthly numbers primarily because of increased thrust on agriculture, an uptick in the FMCG and e-commerce sectors and increasing demand coming from containers and refrigerated trucks.

Tata Motors registered a significant growth on the back of the above-stated reasons. The M&HCV (Medium and Heavy Commercial Vehicle) truck segment continued to be robust despite new axle load norms. It grew on the back of various infrastructure projects, road construction, a building of irrigation facilities and affordable housing projects across the country.

M&M posted a healthy growth thanks to rural penetration. The management expects the growth momentum to continue on the back of some recent refresh launches as well as the better performance of its product portfolio.

Eicher Volvo also witnessed a significant YoY growth of 36.7 percent in the month. Ashok Leyland continued to post strong YoY growth which came at 27 percent.

Cars segment – leader marches on

The leader, Maruti, posted an overall decline of 0.7 percent in PV (Passenger Vehicle) segment. The decline was primarily due to a higher base of last year and lower sales in the compact and mid-size segments. It was also affected due to the phasing out of Ciaz before new model launch.

As per the management of Tata Motors and M&M, the demand for PV was muted due to the impact of monsoon and the 8- day long transporters strike.

For Tata Motors, passenger car segment witnessed a de-growth of 5.7 percent (YoY) and its UV segment continued to witness significant growth (101.9 percent), thanks to the strong demand for its Tiago, Tigor, Hexa, and Nexon.

For M&M, PV segment de-grew by 6 percent YoY. The management indicated there has been an encouraging response to the recent launch - the Plush New XUV500.

Two-wheeler (2W) segment: Bajaj is gaining momentum

Bajaj Auto was the leader In two-wheeler space for the month, clocking a 22 percent YoY growth.

TVS also posted a healthy growth of 11 percent YoY in bikes and 28.8 percent YoY in scooters.

Hero, yet again, posted a significant growth of 9.1 percent YoY in the month. The management indicated that with the forecast of a normal monsoon this year and a strong pipeline of new products coming up, the company is confident of sustaining its growth momentum, going forward.

Eicher posted a modest 7 percent YoY growth in the month. The volume was impacted due to a transport strike and impact on registration in West Bengal due to mandatory licence requirement.

Three-wheeler (3W): Steller show

The overall three-wheeler market continues to gain strength after the end of “Raj Permit” in Maharashtra and new permits in Delhi. Bajaj Auto, the leader in the space, could capture the growth coming in this segment and posted a whopping 67.2 percent YoY growth in the domestic 3W segment. TVS also posted a strong growth of 70.0 percent YoY in 3W volumes and M&M posted a YoY growth of 46.7 percent.

Tractors: gaining on positive rural sentiments

Escorts posted a growth of 3.9 percent YoY whereas M&M posted a YoY decline of 19.6 percent in tractors segment.

The revival of the rural economy and expectations of normal monsoon continue to make the outlook positive for the tractor segment.

Exports: Revival is on

Auto companies had been struggling in the export markets for long. However, the overall revival in the global economy is finally getting reflected in the numbers of some of the leading automobile exporters. All auto majors barring Maruti posted strong YoY growth in the overseas market.