Maruti reports 17.9% growth in October; hopes of bumper sales on Diwali

India's largest carmaker Maruti Suzuki India Ltd dispatched a record 166,825 units to its dealerships in the month of October, 17.9 per cent more than in the same month last year and the highest ever in a month this year, driven by hopes of good sales during Diwali later this month. 

The company posted total sales of 182,448 units which included 6,037 units of the Baleno and Brezza models that it supplied to Toyota Kirloskar Motor Ltd and 9,586 units that it exported during the month. This was higher by 18.9 per cent compared to October last year.

Fiscal 2019-20 was a bad year for the domestic automobile industry with sales declining by a record 18 per cent for the full year. Maruti too saw its sales fall by 16 per cent last year. Yet, the tally in October should instill confidence as it included only one festival -- Navratri, whereas last year both festivals fell during the same month. Maruti's tally was also higher than October 2018 when it had dispatched only 138,100 units. Unlike 2019, that time the market was not depressed. The company has forecast sales to remain buoyant till at least the end of this year but was unsure about demand next year.  

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"This month has been good and next month too sales would be decent. In December, all manufacturers push sales through offers and discounts so I do not foresee a problem during that month either. It's from January onwards that we do not know if there will be a slump in sales or whether the momentum will continue," said R C Bhargava, chairman, Maruti Suzuki India Ltd. "Right now, we are able to sell whatever we can produce so there is no need for a GST cut on cars immediately. If it happens now, there could be a situation when demand will outstrip production and we will not have cars to sell. Any stimulus should come next year when we have some clarity on the demand situation."

The company's growth in October was led by its biggest segment -- compact cars, that grew by 26.6 per cent at 95,067 units. This is the segment that comprises bestsellers like Swift, WagonR, Dzire and Baleno. The entry level mini segment which comprises Alto and S-Presso models registered flat sales at 28,462 units. It recorded a 10 per cent growth in its utility vehicle portfolio at 25,396 units and a 33 percent growth in sale of vans at 13,309 units.

Like Maruti, the rest of the domestic industry is also hopeful of robust sales during the festive season. Chinese carmaker MG Motor said it recorded its best ever retail sales performance at 3,750 units last month. This was higher by 6 per cent compared to October 2019 when it had retailed 3,536 units. The company, which is owned by China's largest automaker SAIC, said it has received stellar response for its newly launched full sized 7 seater SUV Gloster which has received 2,000 bookings at its initial launch price.

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"With festive demand, we have registered 48 per cent growth vis-a-vis last month. We expect continued traction because of Diwali in November and are ramping up supplies to cater to the increasing demand," said Rakesh Sidana, Director, Sales, MG Motor India.

Japanese carmaker Toyota Kirloskar Motor Ltd too registered its highest ever monthly sales this year at 12,373 units, 4.3 per cent more than in October 2019.

"The month of October has been our best month so far since March 2020. The festive season has proved to be bullish as we witness demand surging, month on month. This has been true of our retails too as order flow has been smooth, from the very beginning. The fact that our wholesales have been registering an average growth of close to 50 per cent every month gives us confidence that the demand for bigger vehicles is rising too," said Naveen Soni, Senior Vice President, Sales & Service- TKM.

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