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Old 9th January 2020, 12:08   #1
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Default 2019 Indian Car Sales Snapshot

2019 was one of the most dramatic year in the Indian Automotive Industry. The Industry registered a double digit de-growth for the first time in past 20 years!

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As usual, new models were the life savers for their respective OEMs in 2019! While Kia & MG started off with a bang, Renault was the only OEM to register a positive YoY growth in 2019 owing the success of the new launched MPV Triber. Also Hyundai was able to negate the downfall to a certain extent due to the Sub-4m Compact SUV Venue.

A look at how the OEMs fared in 2019 –

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  • The Market Leader Maruti Suzuki led the downfall with -14.2% YoY degrowth. As per the famous adage – ‘When Maruti sneezes; the entire Auto Industry catches cold’; which is true to a greater extent. Maruti had no major new model launches in 2019 and also the announcement to exit diesel with BS6 transition led to a lot of customers away from the brand. Thankfully; Maruti was able to retain >50% Market Share even though it lost 1.1% Market Share in 2019.
  • Maruti’s loss was clearly Hyundai’s gain. Venue’s timing wouldn’t have been better and the model helped the Korean Major to gain some ground against Maruti.
    Mahindra too had a strong performance backed by new launches (Marazzo & XUV300). However; both the New Models has lost its sheen pretty quick and 2020 shall be a deciding year for M&M as the OEMs dependency on Diesel portfolio is extremely high.
  • Renault had a dream year after a lot of struggle in the past 2 years. Triber has started off really well for the brand and hope Renault is able to SUSTAIN the sales run.
    Kia & MG stepped foot in the Indian subcontinent at a very challenging time. Their launch timing was questioned by all critics and am sure both the OEMs would’ve been extremely anxious themselves. However; both Kia & MG had their share of success and it proves the potential of the Indian market and its consumer. We Indians are extremely value conscious and wouldn’t think twice before buying a product that ticks all the right chords!

Market share graph -


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Source: AutoPunditz &JATO
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Old 9th January 2020, 14:18   #2
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Default re: 2019 Indian Car Sales Snapshot

I dont think the auto industry in India can continue to grow. Especially with the infrastructure limitations. The transit times for the same distance has doubled in most cities. Cant think of any city where the transit time has reduced. (I travel a lot)

Plus would be interesting to see the revenue graph. For example, Tata would have sold more high value products compared to last year, which will mitigate the de-growth to an extent.
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Old 9th January 2020, 14:25   #3
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Default re: 2019 Indian Car Sales Snapshot

Quote:
Originally Posted by 2000rpm View Post
I dont think the auto industry in India can continue to grow. Especially with the infrastructure limitations. The transit times for the same distance has doubled in most cities. Cant think of any city where the transit time has reduced. (I travel a lot)

Plus would be interesting to see the revenue graph. For example, Tata would have sold more high value products compared to last year, which will mitigate the de-growth to an extent.
I agree, the second family car that we have in Mumbai is more for chores and is on the verge of being a liability because of ownership costs outbalancing it's total running. Don't need to own one anymore as many alternative options are developing.
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Old 9th January 2020, 16:20   #4
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Originally Posted by 2000rpm View Post
I dont think the auto industry in India can continue to grow. Especially with the infrastructure limitations. The transit times for the same distance has doubled in most cities. Cant think of any city where the transit time has reduced. (I travel a lot)

Your points are valid but owning a car is also an aspirational thing. Every year people move up the economic ladder and while we may not see the same growth as previous years, we do have a long runway ahead. I understand the Uber / Ola argument but even living in Bombay, neither me nor any of my friends / family has given up on cars and I don't see it happening too. Cabs are convenient when heading to congested areas etc but car ownership should consider to thrive side by side.
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Old 9th January 2020, 16:33   #5
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Originally Posted by AZT View Post
Your points are valid but owning a car is also an aspirational thing. Every year people move up the economic ladder and while we may not see the same growth as previous years, we do have a long runway ahead. I understand the Uber / Ola argument but even living in Bombay, neither me nor any of my friends / family has given up on cars and I don't see it happening too. Cabs are convenient when heading to congested areas etc but car ownership should consider to thrive side by side.
And then I believe there are people like me who are on this forum but do not actually own a car. I don't even intend to buy any (at least for foreseeable future) since I don't even see any usage of a vehicle. My office is 1.5 Hours away and I take company bus (while I know people who come in car). The only advantage they have over me is that they can come and leave at their time. I don't see any point to keep my eyes glued on road for 1.5 Hours in bumper to bumper traffic.
On occasions when me and my family have to go somewhere, our first choice is Auto due to immediate availability and then Uber / Ola. I even took Ola Outstation to Mahabaleshwar (from Mumbai) recently.
I am sure I am not alone with this thought process and I absolutely love driving but I did that only when I was in the US when there are open roads and such.

Last edited by Chetan_Rao : 10th January 2020 at 10:01. Reason: Typo.
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Old 9th January 2020, 16:39   #6
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Default re: 2019 Indian Car Sales Snapshot

Quote:
Originally Posted by AZT View Post
Your points are valid but owning a car is also an aspirational thing. Every year people move up the economic ladder and while we may not see the same growth as previous years, we do have a long runway ahead. I understand the Uber / Ola argument but even living in Bombay, neither me nor any of my friends / family has given up on cars and I don't see it happening too. Cabs are convenient when heading to congested areas etc but car ownership should consider to thrive side by side.
This kind of buying behaviour is not enough to grow the market. For the market to grow, there has to be more first time buyers. Hope you get my point now.
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Old 9th January 2020, 16:47   #7
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Originally Posted by 2000rpm View Post
This kind of buying behaviour is not enough to grow the market. For the market to grow, there has to be more first time buyers. Hope you get my point now.
I’m not sure why you think there won’t be first time buyers. The economic slowdown is temporary but eventually sales will pick up, Both first time buyers and people upgrading / buying additional cars. Uber / Ola / traffic hasn’t really caused the slowdown and in fact Uber etc have gotten consistently more expensive over the past 3 years.
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Old 10th January 2020, 08:49   #8
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Default Re: 2019 Indian Car Sales Snapshot

Let us come to understand that this massive dip in sales last year is just a blip in the Indian automotive industry, given @spideyboy's number's have shown. However we should also accept the fact the growth in the GLOBAL automotive industry is beginning to plateau or has already. The U.S. and China markets have also plateaued in the recent years.

There are several reason for this; new mobility options, lack of parking, and increased cost of ownership etc

In India, we haven't seen any major economic shifts in the last couple of years and the I.T. growth has also cooled. People would still buy cars because of lack of infrastructure, societal pressures and convenience. But don't expect any more than 3 million unit sales per year.

If I were an OEM, I'd definitely look at empowering mobility options, aftermarket and second hand sales more aggressively.
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Old 10th January 2020, 09:14   #9
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Default Re: 2019 Indian Car Sales Snapshot

The statistics is very very very worrying.

What it shows is that in the period 2002-2012 (11 years), car sales grew by a humongous 14% annually.

And in the period 2013-2019 (7 years), car sales grew by a pathetic 1% annually.

It couldn't get more worrying than that - especially when we walk around with titles like the fastest growing economy in the world
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Old 10th January 2020, 09:27   #10
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Default Re: 2019 Indian Car Sales Snapshot

I think the dip in 2019 was on account of multiple factors including economic slowdown, low buyer sentiment, BS-VI transition, cars getting expensive on safety role-out, haste discussions around EVs, dip in sales for OLA / UBER, inventory rationalisation by OEMs and what not. The dip is temporary for sure. We, as a Nation, have a lot of potential for cars. The situation in Tier-I cities is very different from rest of the nation. Demand for new cars has definitely slowed down in major cities but the rural areas hold a lot of potential. I firmly believe that the industry will cross the 4-million sales mark in the next 5-7 years.

Also, i think that 2020 will be the year of stabilisation. The economic slowdown will settle a bit, BS-VI transition will happen, we will start seeing affordable (relatively) EVs, entry of multiple new Chinese players and all these factors will hit the industry in a mixed way. My estimate is, 2020 will either be flat or will show less that 5% growth in numbers. Growth is more likely because we have already hit the bottom in 2019.

2021 will change everything for us. It will be the year of double digit growth (or may be late single digit) again. The economic down-cycle would diminish by then, emission norms will settle fully, and the biggest factor would be the "Scrappage policy" expected to be announced by the Government. This policy alone can drive the industry for the next few years and i have high hopes from the GOI on this.

All in all, the worst is over IMO. Things will only get better from here. The growth may not be as steep as seen in the last decade, but the industry will bounce back. And yes, the composition is about to change soon. Maruti may not occupy half the market going forward and will probably loose at-least 10 percentage points in market share in the next decade.
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Old 10th January 2020, 10:18   #11
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Default Re: 2019 Indian Car Sales Snapshot

I can't speak for everyone but when my folks felt the need for another car, they didn't buy new. Nor will they for the foreseeable future. They got one used. Important to note is the decision to have no more new ICE vehicles in the family, a suburban one at that. The entire landscape is going to change in a few years and to invest in a new 'old type' vehicle doesn't sit well with logic for us. Especially given we keep our vehicles for quite long. So, along with the market reaching a plateau given the conditions and other transit options, this unpredictability too has a role to play.

The only thing growing more than our miseries currently is our hope for a sustainable conclusion, and thereby a sustainable growth.
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Old 12th January 2020, 09:09   #12
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Default Re: 2019 Indian Car Sales Snapshot

Quote:
Originally Posted by qr20de View Post
this massive dip in sales last year is just a blip in the Indian automotive industry,
That could be the understatement of the year.
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Old 19th January 2020, 20:17   #13
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Default Re: 2019 Indian Car Sales Snapshot

Segmentwise Car Sales Analysis – 2019

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  • Out of all segments; the Premium Sedan grew the highest at 28%! The segment volumes being small grew incredibly post the addition of Civic. Honda’s Civic was also the Best Selling Premium Sedan for 2019!
  • Compact SUV Segment has grown very strong in the past few years. As a matter of fact; it has emerged to be the 3rd biggest segment in terms of volumes in 2019! It was just 2,143 units short of the second largest segment (Premium Hatchback). 2 new models made entry in the segment in 2019 – Mahindra’s XUV 300 & Hyundai’s Venue. Both the new models fared well for their respective OEMs. 2020 should see Kia & Renault entering the segment too.
  • MUVs have got attention of the OEMs and exciting offerings / concepts are available with the customers now. While XL6 was offered as a premium offering with captain seats; Triber really ticked the boxes in Rs.6-9L range. The New Ertiga too got many takers and was also one the Top 10 selling cars in many months in 2019. Kia shall introduce the Innova-competing Carnival in 2020 and heat up the segment even further.
  • Mid-SUVs saw the highest excitement in 2019! Kia & MG launched their entry model in the sub-continent in the segment. Both the models did much better than expected and led to the growth of the segment. Even Skoda shall be showcasing its offering in the segment in the upcoming Auto Expo.

Source: AutoPunditz
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Old 19th January 2020, 21:11   #14
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Default Re: 2019 Indian Car Sales Snapshot

The number of households that own a car in India as a percentage of population is extremely low compared to developed economies.

If we expect the Indian economy to grow, then rest assured there will be new car buyers. Am looking to buy a new car myself.

The only limiting factor for growth will be road infrastructure in Indian cities and towns. Else the Auto Industry in India can continue to grow for a decade atleast if not more whether it's an EV or ICE is a different matter.

This is not a western world where everything is hunky dory. I hate taking Ola/Uber in India what with their dirty cars, unruly drivers, surge pricing, multiple cancellations and bookings etc.

I don't even have last mile connectivity from Metro being in Indian silicon valley, let alone pavements and street lights to walk a couple km or so home. This is what we do in western world. Car ownership will come down once we have all this in place.
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Old 20th January 2020, 07:16   #15
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Default Re: 2019 Indian Car Sales Snapshot

2019 Indian car sales/production figures are a symptom of a much larger malaise.


The symptom has been ignored for long, giving reasons such as ridesharing, EVs, BS-VI and GST. These are contributors but are these the major contributors? IMHO the single biggest factor is that the Indian economic growth is stunted.
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