Companies that managed and failed to escape ill fate following the turbulence in April-May
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The fastest growing automotive market in the world, India defined the global trends all across the world until 2011, even at the times when the other markets had nothing to show but a dismal progress. However, the penetration level of cars in India remains minuscule with only 20 cars per 1,000 individuals against the penetration level of 500-700 cars per 1,000 individuals in developed nations.
However, the government of India seems to have turned blind to the need to increase the penetration level as the period of April-May was tarred by several blot marks in the history of Indian automotive industry. It seem like ages have past since January 2009 when the petrol price ranged in between Rs. 42-45, as May 2012 witnessed the prices being hiked by a whooping Rs.7.5 for every litre to Rs. 73.18. The government did not seem to be in a lenient mood as it also increased the excise duty on all the cars in the Union Budget of 2012. The adverse situation did no seem to end here as the Indian National Rupee further dipped by Rs. 56.52 as compared to the dollar, which led to increase in import costs.
The turbulence had a major impact on the car makers as well since many of them reported decline in sales. However, the Indian subsidiary of the French car maker, Renault emerged as a clear winner with a YoY growth of 171.38 per cent with sales of 787 units in June 2012 against 290 models sold in June 2011. Renault Duster released in July 2012 is a huge success, registering 6000 bookings in the opening week. This might lead to Renualt topping the list of YoY sales figure for July too.
Close on its heels was Japanese auto giant, Nissan Motors, which sold 4,167 units in June, 2012 as compared to 1,632 nos sold in same period last month to mark a growth of 155.33 per cent. According to a company statement from Nissan, the major contributor to its sales were the Sunny sedan and the Micra hatchback with Sunny spearheading the growth. Managing Director, Nissan Motor India Private Limited (NMIPL), Ishida Takayuki, said, “Despite the fact that the auto industry in India has been going through some uncertainty in view of the recent fuel price hike and general economic growth, our sales have remained strong. This performance has been underpinned by the strength and diversity of our model range. It will further expand with the launch of Evalia later in the year.”
Surprisingly, Skoda Auto too made its way into the top three list in terms of sales with a surge of 88.55 per cent as it sold 4,923 units in June 2012 as compared 2,611 vehicles sold in corresponding month last year. The car maker is now in the process to expand its dealership network in the country from the existing 106 dealers.
While these companies emerged unscathed out of the turbulent period, there were several companies which were affected pretty badly as their sales declined in a major way. The worst affected was the HM-Mitsubishi, which declined by 33.90 per cent with a sales of mere 273 units as compared to 413 in June 2011. Next up on the list of companies that failed to cope with the turbulence is Honda Motors, which sold 2,667 units against 3,455 vehicles sold last year to sink by 22.81 per cent. While, Tata Motors was at the bottom of the list with a 21.60 per cent dip in the sales, which stood at 17,244 in June 2012 against 21,994 nos. sold in same month of 2011.
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