There quite a few positives for Automobile manufacturers in the current period. Firstly the Rainfall has been good this year, which has infused optimism in the overall economic atmosphere in the country. Secondly, the Govt. has announced 7th Pay Commission for it's employees & people are again set to get healthy arrears. Even Ex-servicemen are getting their OROP arrears this year. Add to all this, the prime festive period of Navaratri to Diwali has arrived a couple of weeks early this year, compared to last year.
Most of the leading 2-wheeler makers have been reporting over 20% Y-o-Y Growth in dispatches since the last few months. The Car makers too have seen Total Sales increase by nearly 18% Y-o-Y in the recently-ended Q2 of current fiscal, after reporting single-digit growth in Q1. In order to understand who all have Gained & who all have Lost in the race for Market-share over the last 1 year, I have arranged the Quarterly
Market-share Data of all Car Makers in India (Excluding the Luxury Car Makers). There have been quite a few Surprises & changes in market-share Rankings over the last 1 year. The most prominent one being the rise of Renault-Nissan Alliance moving up from No.9 position in Q2 of last fiscal to No.4 position in Q2 of current fiscal. The primary reason for this rise has been the stupendous success of Renault's small car KWID, which was launched around the end of September'2015. The KWID helped increase Renault-Nissan's market share from under 2% in Q2-FY'16 to around 4.70% in the following quarter. And the market-share has kept improving with every passing quarter till now. Renault's KWID got some assistance from Datsun's Redigo in the recent few months. It will be interesting to see if Renault-Nissan Alliance is able to build on this 12-months of success and progress towards being a strong No.3 player in the Indian Car Market.
The next big surprise is Maruti-Suzuki's Sales resilience. Despite all the incremental competition from Renault-Nissan or Ford or Hyundai or Tata or others, Maruti Suzuki has seen it's market-share remain steady around the 47-48% range. It's Q2-FY'17 market-share being slightly higher than Q2-FY'16 suggests that Maruti-Suzuki managed to grow it's Sales during the period slightly faster than Industry growth. Yes, it's ALTO model did take some hit from KWID, but the drop in volumes was just about 10% or so. This was more than compensated by success achieved by Maruti Suzuki's new launches of the BALENO and the VITARA BREZZA and also the CIAZ. All these three models are near the upper-end of Maruti-Suzuki's model portfolio and hence their success means a lot more to the company than the small drop in sales of it's ALTO model. Both the BALENO and the BREZZA are currently commanding a waiting period of almost 3 to 5 months, which is making the company even more desperate to see Suzuki's Gujarat plant being commissioned, which is expected to happen sometime in 2017.
The next surprise is Honda's struggle for Volumes, which started in November'2015. Since then the company has been saying that it has slowed down dispatches of Diesel versions of it's Car models as there has been an inventory pile-up at dealer level due to slower demand for the same. But it's been nearly 11 months since then and Honda's volumes are still nowhere near normal, though there has been slight recovery in numbers due to BRV launch a few months ago. Honda reported a 28% Y-o-Y drop in volumes during Q1 of this fiscal, which was followed by about 18% Y-o-Y drop in volumes in Q2. This massive under-performance resulted in Honda's quarterly market-share dropping by nearly 250 bps in Q2 of this fiscal, compared to a year-ago period. Honda lost it's No.3 position during this period and is now at No.5, which too is under threat from a resurging Tata Motors.
The next point is Mahindra & Mahindra's lacklustre show despite several new potentially volume-generating launches over the last 12 months. M&M's market-share improved from 7.2% in Q2-FY'16 to 9.45% in Q4-FY'16, primarily on the back of 2 new launches in the Compact SUV space: the TUV300 and the KUV100. But both these models have failed to hold volumes beyond the initial couple of months, despite good marketing & promotional support. The NuvoSport, which was introduced later, was an even bigger dud in terms of volumes. M&M will again be pinning it's hopes on the refreshed & slightly-shorter version of the BOLERO to bring increased volumes for the company. Since the BOLERO now confirms to the Compact segment restrictions, it is cheaper by nearly Rs.1 lakh compared to the previous model. Hence it is now even better value-for-money than before and hence has good chances of being successful. M&M has managed to grab & hold the No.3 position since Q3-FY'16, but it needs to do better to continue holding the rank.
Coming to rest of the car makers, the No.2 Rank holder Hyundai has done a fine job through most of the year, but posted slower growth in latest quarter, resulting in slight erosion in market-share. Seems like Hyundai's ELITE i20 and the CRETA models are losing some steam in the face of increased competition. Tata Motors too has finally found success with it's TIAGO model, which is currently commanding a waiting-period of 2 to 3 months. The company is ramping up production at a measured pace and hence we haven't seen it's volumes shoot up suddenly. At the same time Tata Motors has another 2 to 3 new models lined up for launch, spread over the next 12 months, which should boost the company's image as well as market position in the coming quarters. Toyota continues to remain dependent on it's INNOVA model for volumes & market-share, which has remained more or less steady, even after the launch of the new generation INNOVA. The company has also refreshed the ETIOS siblings with a hope of finding more volumes.
Ford and Volkswagen have also gone nowhere in terms of market-share over the year. Ford did launch it's brand new Compact Sedan the ASPIRE and the new generation FIGO late last year. Everyone expected Ford to improve it's market-share with these new models. But it's been a big surprise to see both these capable models to do lacklustre volumes, while Ford's ECOSPORT continues to generate decent monthly volumes, despite increased competition in the Compact SUV space. Volkswagen group has only recently got slightly ambitious for increased domestic volumes.Volkswagen worked on it's POLO/VENTO platform and has introduced the AMEO compact sedan recently, which it hopes will help boost it's volumes to some extent. The result for the same is yet to be seen.
Most of the leading 2-wheeler makers have been reporting over 20% Y-o-Y Growth in dispatches since the last few months. The Car makers too have seen Total Sales increase by nearly 18% Y-o-Y in the recently-ended Q2 of current fiscal, after reporting single-digit growth in Q1. In order to understand who all have Gained & who all have Lost in the race for Market-share over the last 1 year, I have arranged the Quarterly
The next big surprise is Maruti-Suzuki's Sales resilience. Despite all the incremental competition from Renault-Nissan or Ford or Hyundai or Tata or others, Maruti Suzuki has seen it's market-share remain steady around the 47-48% range. It's Q2-FY'17 market-share being slightly higher than Q2-FY'16 suggests that Maruti-Suzuki managed to grow it's Sales during the period slightly faster than Industry growth. Yes, it's ALTO model did take some hit from KWID, but the drop in volumes was just about 10% or so. This was more than compensated by success achieved by Maruti Suzuki's new launches of the BALENO and the VITARA BREZZA and also the CIAZ. All these three models are near the upper-end of Maruti-Suzuki's model portfolio and hence their success means a lot more to the company than the small drop in sales of it's ALTO model. Both the BALENO and the BREZZA are currently commanding a waiting period of almost 3 to 5 months, which is making the company even more desperate to see Suzuki's Gujarat plant being commissioned, which is expected to happen sometime in 2017.
The next surprise is Honda's struggle for Volumes, which started in November'2015. Since then the company has been saying that it has slowed down dispatches of Diesel versions of it's Car models as there has been an inventory pile-up at dealer level due to slower demand for the same. But it's been nearly 11 months since then and Honda's volumes are still nowhere near normal, though there has been slight recovery in numbers due to BRV launch a few months ago. Honda reported a 28% Y-o-Y drop in volumes during Q1 of this fiscal, which was followed by about 18% Y-o-Y drop in volumes in Q2. This massive under-performance resulted in Honda's quarterly market-share dropping by nearly 250 bps in Q2 of this fiscal, compared to a year-ago period. Honda lost it's No.3 position during this period and is now at No.5, which too is under threat from a resurging Tata Motors.
The next point is Mahindra & Mahindra's lacklustre show despite several new potentially volume-generating launches over the last 12 months. M&M's market-share improved from 7.2% in Q2-FY'16 to 9.45% in Q4-FY'16, primarily on the back of 2 new launches in the Compact SUV space: the TUV300 and the KUV100. But both these models have failed to hold volumes beyond the initial couple of months, despite good marketing & promotional support. The NuvoSport, which was introduced later, was an even bigger dud in terms of volumes. M&M will again be pinning it's hopes on the refreshed & slightly-shorter version of the BOLERO to bring increased volumes for the company. Since the BOLERO now confirms to the Compact segment restrictions, it is cheaper by nearly Rs.1 lakh compared to the previous model. Hence it is now even better value-for-money than before and hence has good chances of being successful. M&M has managed to grab & hold the No.3 position since Q3-FY'16, but it needs to do better to continue holding the rank.
Coming to rest of the car makers, the No.2 Rank holder Hyundai has done a fine job through most of the year, but posted slower growth in latest quarter, resulting in slight erosion in market-share. Seems like Hyundai's ELITE i20 and the CRETA models are losing some steam in the face of increased competition. Tata Motors too has finally found success with it's TIAGO model, which is currently commanding a waiting-period of 2 to 3 months. The company is ramping up production at a measured pace and hence we haven't seen it's volumes shoot up suddenly. At the same time Tata Motors has another 2 to 3 new models lined up for launch, spread over the next 12 months, which should boost the company's image as well as market position in the coming quarters. Toyota continues to remain dependent on it's INNOVA model for volumes & market-share, which has remained more or less steady, even after the launch of the new generation INNOVA. The company has also refreshed the ETIOS siblings with a hope of finding more volumes.
Ford and Volkswagen have also gone nowhere in terms of market-share over the year. Ford did launch it's brand new Compact Sedan the ASPIRE and the new generation FIGO late last year. Everyone expected Ford to improve it's market-share with these new models. But it's been a big surprise to see both these capable models to do lacklustre volumes, while Ford's ECOSPORT continues to generate decent monthly volumes, despite increased competition in the Compact SUV space. Volkswagen group has only recently got slightly ambitious for increased domestic volumes.Volkswagen worked on it's POLO/VENTO platform and has introduced the AMEO compact sedan recently, which it hopes will help boost it's volumes to some extent. The result for the same is yet to be seen.
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