Utility vehicles sales drop 6 per cent in June

The domestic sales of utility vehicles continue to decline. Data released by Society of Indian Automobile Manufacturers (SIAM) today shows that sales of utility vehicles have declined 6 per cent year-on-year from 43,849 units in June 2014 to 41,278 units in June 2015.

In the April-June 2015 period, sales have declined 0.5 per cent. Sugato Sen, Deputy Director General of SIAM, says that the decline in sales of utility vehicles is mainly because the rural economy is not doing well.

Exports of UVs have also declined sharply from 5,314 units in June 2014 to 3,860 units in June this year, registering a drop of 27 per cent. According to Sen, the number of UVs exported is so small that any drop would look like a significant decline in percentage terms.

However, despite falling sales the segment is going to see some launches in the coming months including Hyundai Motors' compact sports utility vehicle (SUV) Creta, which will be launched on 21 July.

According to Rakesh Srivastava, Senior Vice-President, Sales and Marketing, Hyundai Motor India, in the last six months, sales of compact SUVs have registered a decline of 6 per cent primarily because there were no new launches during the period.

"For growth of any segment, product launches are very critical," says Srivastava.

Creta, to be priced in the range of Rs 9-14 lakh, is likely to compete with Renault Duster, Ford Ecosport and Nissan Terrano.

Katsushi Inoue, CEO of Honda Cars India, which recently launched its B segment passenger car Jazz, said that the company sees compact SUVs as a growing segment, and they are studying the market to launch a compact SUV. Honda is not present in the compact SUV segment, where the vehicles are priced up to Rs 15 lakh. It's CRV model is available in the  Rs 15-25 lakh category.

Meanwhile, the domestic sales of overall passenger cars saw a drop of 0.5 per cent year-on-year in June, while overall vehicle sales have grown by 2.56 per cent on the back of strong sales growth by medium and heavy commercial vehicles. The segment grew by 21 per cent from 18,374 units in June 2014 to 22,184 units in June 2015.