While September ended on a sour note there was still something to cheer about for the industry.
The week saw six launches of new as well as refurbished products ranging from premium motorcycles to minis and the mighty SUVs. Companies hoped that these launches will help lift the prolonged slowdown.
The weekly wrap talks about this silver lining in detail, but first, here is a look at what made headlines in the auto space during the week:
Maruti launches S-Presso at Rs 3.69 lakh
The first all-new car brand from Maruti in two years, it is notably being launched in the middle of one of the worst slowdowns seen in the Indian car market.
Developed largely in-house at their Rohtak engineering centre in Haryana over last three years, the S-Presso is Maruti’s attempt at reigniting excitement within the entry-level segment.
Skoda to launch six more cars in India
Czech car brand Skoda Auto will launch six models in India by 2021. These will include two new launches and a few upgrades as part of its plans to revive its sagging fortunes.
The company, which is part of the Volkswagen group, has launched a premium version of the Kodiaq sports utility vehicle called Kodiaq Scout priced at Rs 34 lakh.
Car sales nosedive yet again
Monthly car sales took a nosedive yet again as buyers remained reluctant in September, despite discounts on offer breaking all previous records.
Rising fuel prices, the anticipation of a goods and service tax (GST) cut on automobiles, and an increase in discounts and Shraad period hampered sales despite banks easing lending norms.
Renault Kwid launched at Rs 2.83 lakh
Renault has re-launched the Kwid with a facelift at Rs 2.83 lakh (ex-showroom, Delhi). Bookings have begun on the Renault website for a token amount of Rs 5,000.
The new Kwid gets styling changes as well as more equipment from its previous generation. Mechanically, however, the hatchback continues with the same engine options as its predecessor.
Mahindra, Ford to form a new company
Mahindra will invest Rs 657 crore to own 51 percent stake in the JV company with Ford holding the rest.
This new company will assume ownership of Ford’s India operations including personnel and assembly plants in Chennai and Sanand, Gujarat.
Hyundai launches new Elantra, Lexus launches RX 450hL
Hyundai Motor India has launched an updated version of its premium sedan Elantra priced at Rs 15.89 lakh (ex-showroom Delhi). The model now comes with blue link technology that aides 34 connected features, wireless charger and front ventilated seats, among others.
Japanese car-maker Toyota's luxury vehicle arm Lexus on October 3 launched luxury hybrid electric SUV RX 450hL in India priced at Rs 99 lakh (ex-showroom Delhi). The fourth-generation model, which now comes with an additional third-row seating, will be available for booking starting this month.
Tata Motors bags 300 electric bus order
Tata Motors on October 4 said it has bagged orders to supply 300 electric buses from Ahmedabad Janmarg (AJL).
The company will supply Urban 9/9 electric model of buses which will run in Ahmedabad's Bus rapid transit system (BRTS) corridor, Tata Motors said in a statement.
These buses will be deployed under the operation expenditure (OPEX) model which works on the pay-per-km basis. Tata Motors will be setting up the required infrastructure, including fast charging and support system, it added.
Has the auto market bottomed out?
September marked yet another month of decline in sales for automakers, but there was a hidden silver lining in the messages that were overlooked.
Tata Motors posted a staggering 56 percent decline in sales during September. However, the president of its passenger vehicle business unit said: "there was an encouraging response in terms of consumer footfall in September."
This resulted in an 11 percent rise in retail volumes compared to August.
Similarly, Toyota Kirloskar witnessed 18 percent fall in wholesale sales in September but saw a rise in retails towards the end of the month.
"With Navratra beginning from September 29-30, customer orders have been slightly encouraging. We hope the pace continues and the sluggishness in sales withers away in the festive season," remarked a senior executive.
Its rival Honda too agreed that there was an uptick in volumes in September never mind the 60 percent fall in wholesale during the same month.
Besides uptick in sales there also came positive news from the transport sector. The Indian Foundation of Transport Research and Training (IFTRT) said that truck rental was up on the back of improved consumer spending and good freight availability.
"Trunk routes like Delhi-Mumbai-Delhi, Delhi-Kolkata-Delhi, Delhi-Hyderabad-Delhi and Delhi-Bengaluru-Delhi are up 4 percent. Delhi-Chennai-Delhi is up 3 percent," said a note from the watchdog.
The increase in freight rates comes on the back of a rise in fuel prices. This positively means that transporters have passed on the rise to consumers and consumer’s haven not backed off. Rise in retails means that buying activity is gathering pace although at a slow pace.
With no cut in GST on automobiles, one of the primary reasons why consumers were holding back purchases, buyers may be busy negotiating final deals with dealers.This augurs well for the industry which has been in disarray for several months after having been forced to go slow on production.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.