Sunday, March 22, 2015

India's Luxury Automobile Market - 2014

India's Luxury Auto space has seen a positive movement in 2014 vis-a-vis the flat growth of passenger car sales. Sales of Luxury Auto makers such as Audi, Mercedes, BMW & Volvo are estimated to have grown by 9% v/s less than 1% growth in overall automobile market.

While Management Punditz have been extensively tracking the data of passenger car sales, retrieving luxury car sales figures has been a challenging task. The luxury car makers seldom share data and the data is shared only when these companies have to project their growths or achievements. This behavior is also being questioned by SIAM and analysts fraternity as well. The confusion also lies whether the data shared by these manufacturers are for offtake or retail - majority of the times whichever data is higher is being shared and makes it all more difficult for us to interpret.
Source: ET
However, 2014 figures were as expected - it was a year of growth for automakers with new launches, both in luxury space & passenger cars. Audi & Mercedes benefited from the launch of the new products and were able to project considerable growth over previous year. Audi led the rankings with sales of 10,851 units, which was 650 units more than second in race Mercedes-Benz (10,201 units).

BMW was the biggest laggard in this space - BMW managed to sell only 6812 cars which is 7% lower than 2013. No exciting launches by the automaker proved to be the shortfall for the German major.

But the company which made a majestic comeback was Mercedes-Benz! Don't be surprised if MB jumps to the numero uno slot in 2015. The German car maker was on a product offensive strategy and has worked superbly for the auto giant. These points were instrumental for growth of Mercedes-Benz in 2014:

  • 7 products/upgrades launched in first half of 2014 (like New S-Class, C-Class Grand Edition, GL63 AMG, etc) and 7 more product launched in the second half (say CLA 45 AMG, new E350 CDI, GLA 45 AMG, New C-Class etc).
  • 'Excellence in Network' strategy - Focus on strengthening the reach in India. A record 14 outlets were inaugurated in 2014 which allowed the car maker to access the prospects in Tier-1 & Tier-2 cities as well. Don't be surprised to see Mercedes outlets in cities like Surat, Bhubaneshwar, Raipur, Bhopal, Chandigarh, Mohali, Karnal and Nashik!
Mercedes Benz has similar plans in 2015 - It plans of launching 15 new vehicles in 2015 and also open 15 new dealerships this year! Mercedes is also planning to invest 10 Billion Rupees to double production capacity to 20,000 units a year.

The rankings in the luxury car space has become all more competitive and the German giants are fighting it hard to reach the no.1 slot. However, India is a tough market to crack and only the best will excel. It will also be interesting to assess the growth of the likes of JLR & Volvo in the coming years. For 2015, we believe it'll be the 'Best or Nothing' :) 

Tuesday, March 3, 2015

Indian Car Sales Figures - February 2015

A Look on Feb'15 OEM-wise offtake numbers:
Source: AutocarPro
February 2015 Sales Figures - Pan India
Top 10 selling Brands:

Source: ET
Jan'15 v/s Feb'15 comparo:
Source: ET

Saturday, February 14, 2015

Top 25 Cities - Car Sales India 2014

The automotive industry in India is one of the largest automotive markets in the world. It was previously one of the fastest growing markets globally, but is currently experiencing flat or negative growth rates.  However, as per the recent reports, India overtook Brazil to become the sixth largest passenger vehicle producer in the world (beating such old and new auto makers as Belgium, United Kingdom, Italy, Canada, Mexico, Russia, Spain, France and Brazil).

Around 25,10,367 (Twenty five lakhs Ten thousand and Three hundred and sixty seven) cars were sold in the year 2014 (statistics is offtake numbers). You’d be surprised to know that almost fifty percent of these cars were sold in 25 cities itself (12,17,267 cars sold in top 25 out of 153 cities).

Let’s look at the city-wise sales figures –
Top Cities - Car Sales India 2014
  • Delhi-NCR contributes to over 10% of overall sales and makes it easily to the top slot in the Top 25 cities. Though terming Delhi-NCR as a ‘city’ would be unfair, maintaining the sales count for Delhi and NCR separately has never been easy and hence the combined statistics.
  • Delhi-NCR beats the second biggest city (Mumbai) comfortably and sells almost two and half times of the latter.
  • Out of the 4 biggest metropolitan cities (i.e. Delhi, Mumbai, Kolkata & Chennai) – Kolkata and Chennai couldn’t make it in the top 4 cities for car sales. Chennai ranks 7th in the list and Kolkata takes the 9th slot.
  • Bangalore makes a strong presence with average sales of over 8000 cars per month and stands third in the list.
  • Another interesting statistics in the states which house the top 25 cities. Gujarat emerges top and has 4 cities in the list (Ahmedabad, Surat, Vadodara & Rajkot). Kerala & Maharashtra houses 3 cities each (Kochi, Trivandrum & Calicut for Kerala; Mumbai, Pune & Nagpur for M’rashtra).
As cities in the Indian sub-continent prosper, the sales would grow as well. But the inherent infrastructure woes, unplanned urbanization, growing accident rate have been demeaning to this growth. The planning in these cities should be much more robust to sustain more influx of cars and support the growth.  

Wednesday, February 4, 2015

Indian Car Sales Figures - January 2015

Source: ET

January 2015 Sales Figures - Pan India

Source: AutocarPro

Tuesday, January 6, 2015

Indian Car Sales Figures - December 2014

Source: Economic Times
This Christmas, Santa bestowed the Auto Industry with a positive push and the Industry ended the year on a positive note. The gifts offered by Santa were particularly highest ever discounts for the year, news of increased car prices in 2015 from all OEMs and the fear of increased Excise Duty in 2015 from the Government. December thus proved to be cheerful for majority of the manufacturers and the dealer fraternity as well was successful in reporting high retail figures. The inventory was rationalized at OEM & Dealers end - also the end customer benefited from hefty discounts and pre-excise hike prices. Hence a win-win situation for all parties.
December 2014 Sales Figures - Pan India
December 2014 saw the start of dispatches (from OEM to dealers) of 2 big launches slated in Jan 2015 - Tata Bolt & Datsun GO+. Both the cars are part of the vital strategy for Tata & Datsun/Nissan. While Tata has tasted a hint of success from Zest - Bolt would allow it to get the lost numbers on board and vouch for the third largest OEM position strongly. Also GO+ will support the Datsun stable by bringing some buzz in the brand and expand the portfolio rightly for the automaker. GO+ will be significant for the Datsun stable to strengthen its presence in Indian market and gain the required volumes for 2015.

Maruti's performance was stellar and saw a 13% YoY increase. Alto's back into >20k figures and the recent facelift has boosted the brand positively. Celerio however has been not able to post consistent numbers (maybe it has lost the sole product with the AMT advantage). Ciaz slip in numbers has been a concern as well - challenging City will be quite a task for the sedan.

Hyundai successfully retired the Santro and the last car was dispatched in December'14. i20 Elite, i10 Grand, & i10 were the notable performers for the Korean major. However, the carlines which were struggling were - Xcent, Verna, Eon & Elantra.

Honda posted strong numbers for City and Amaze - all thanks to the 1.5L iDtec engine which proved revolutionary for Honda and has single handedly changed the fortune of the Japanese Automaker. Mobilio numbers however is a concern and the MUV is not performing as per expectations.

Mahindra nearly touched 10k figures for Bolero and the carline proved its worth yet again.However, other brands of the Indian SUV major saw a beating - even the all new Scorpio push rise in the sales figures as expected.

Another interesting statistic for the entire industry -
Source: Autocar
Also a look at the top 20 cars for Dec'14 -

Thursday, January 1, 2015

New Honda City - Car of the Year 2014

Note - Individual Brand and OEM sales mentioned above are calculated from the month since the nominee was launched. Ex: The sales of Datsun GO shown is the offtake figure from Mar'14 to Nov'14, simultaneously OEM sales indicate Nissan+Datsun cars offtake from Mar'14 to Nov'14. Similarly Celerio's figures shown here is from Jan'14 to Nov'14 and OEM sales highlight Maruti's sales from Jan'14 to Nov'14.

Our Winner in the list is undoubtedly the 2014 Honda City. The fourth generation city had something different from all its siblings from the previous generations – a new diesel heart which proved to be the game changer for the Japanese automaker. And to be fair enough it was not only the diesel engine, but the overall package that made the comeback a huge success. To highlight on its success and acceptability – City outsold the much cheaper Amaze in 9 out of 11 months since its launch! Also City easily outpaced the other cars in the segment (say Verna, Linea, Vento, Rapid, etc). Maruti has made a bold attempt to challenge City’s dominance with Ciaz, but we are sure City will easily remain at the top slot for immediate future as well. The significance of City can be understood by the contribution it has to Honda’s overall sales – The New City contributes to hefty 40% of Honda’s sales in India. This one product had always defined the OEM’s performance in the sub-continent since its presence and the New City lives upto its legacy.

Datsun announced its big ticket plans for India & World by launching its entry level hatchback – Go. The expectations were huge for the new brand under the Nissan management, and got the right set of eyeballs in the beginning. The launch price was also attractive and had the right set on ingredients (like big on space, mileage and great specifications) to make it big in the Indian market. However, because of its poor sales network, improper brand building, lack of strategy led to the downfall in sales. The carline is averaging petty ~1k units in past 6 months and the future remains a concern. It however contributes to 32% of overall Nissan sales since its launch and with the Go+ launch in the anvil, we believe it’ll benefit from the collective presence.

What City did for the Honda brand in India, similarly Scorpio was for M&M – it established M&M in the big leagues of passenger car makers in India and wouldn’t be wrong to say that Scorpio has a significant contribution in making M&M as one of the top 3 Auto OEM’s in India! The carline saw many updates since its launch in 2002 and the 2014 update was the most comprehensive one. It completely overhauled its interiors and made the package more premium. It now could easily challenge the newcomers (say Duster, Terrano, etc) which were questioning Scorpio’s dominance in the segment. Similar to City, Scorpio did not see any major updates in the interiors and the changes were pretty significant only in the inside.

Zest becomes the most important launch for Tata – the carline is a do-or-die product for the brand and the OEM treated it as one! The car answered all the questions that were raised against the brand (quality, looks, features, price & maintenance). It got many customers which otherwise wouldn’t had thought about a product from the Tata’s stable. Zest slowly but confidently has made incremental numbers for the OEM and the trend looks positive in the coming months as well. It is already contributing to 29% of the sales and is bound to increase with rationalizing of production.

The Indian’s love for MUV got a whole lot sweeter with Honda betting big in the segment. The launch of Mobilio made Honda’s portfolio the strongest since its footsteps on the Indian soil. Honda now had a product offering in every segment! (hatchback-Brio, entry level sedan-Amaze, sedan-City, MUV-Mobilio & SUV-CRV). The price though was questioned by many as it was priced quite higher than the Ertiga and the top-end Mobilio cost as high as Rs. 15 lac! (on-road). The carline contributed to overall 27% of Honda’s sales since its launch.

Elite i20 – as its tagline says, has been ‘uncompromising’ on all fronts and has the most extensive update the carline has ever seen till date! The car offers so much that it puts many C-segment sedans to shame. Even with the ultra-premium price tag, it easily overtook the sales of the cheaper offerings (named grand i10, Xcent, Eon & i10!) at many occasions since its launch. To make the whole dealer sweeter, the Elite crossed the 10k figure for the first time since its launch in Nov’14. The car undoubtedly is the best package that any car offers in the segment and offers great potential for Hyundai to explore (did we say elite i20 sedan or a crossover?).

Hyundai Xcent carried the brand salience of grand i10 and promised to offer everything that Grand offers with much more practicality. Xcent tried to position itself between grand and i20 and stood as an attractive prospect in the country’s fastest growing segment (sub-4m sedan category). It caught significant attention immediately after launch and posted enviable numbers. However, the positioning went weak post launch of elite i20 and the sales chart experienced variance. The carline contributed 16% of Hyundai’s sales since its launch.

Toyota was always the D-segment leader with Corolla, but the carline had never seen some big changes since launch. The New Corolla Altis was the answer Toyota sought for the brand. The futuristic design and features made it an instant hot seller and bought numbers which were unseen by the segment in a long time (crossed 1k figures simultaneously in Oct’14 & Nov’14).

Sunday, December 28, 2014

India - An Expert in Exports!

A look at India’s top Automobile OEM Exporters.

Based on the investments for capacity expansion from Auto OEM’s two years back (, the team at Management Punditz had predicted that the India will slowly emerge as an Export Hub. The country is currently looking at a manufacturing capacity of 30-35 lakh passenger cars per year and the OEM’s can leverage this capacity only exporting their models to other countries / continents. India is also in the race to displace Thailand as the Global Auto Hub by 2020.(source).

While the local market is going through a tough time, these OEM’s can leverage on their manufacturing base for exports. The best example here is Nissan – The Japanese manufacturer exports upto 70% of its production! While the company is fighting hard to gain ground in the Indian market, it is effectively utilizing its resources to leverage on the demand elsewhere. Many auto OEM’s have jumped the bandwagon to start or even increase exports from the sub-continent. ‘Make in India’ campaign is adding blitz to the process and is trying to attract even more OEM’s to start exporting from India. But can India prove its competitive edge – We still are behind in terms of liberalizing our policies and our taxation structure is inconsistent. Our manpower unions just add to the woes. Sustaining profits and supportive policies by Government will the key for the growth. We yet face many challenges here (see why Mercedes Benzopts out for using Indian operations for exports and exports on decline).  

See segment-wise Top exporters based on Apr'14 to Nov'14 data –

Passenger Cars: 
The Passenger Car makers which was under pressure in domestic market underwent a tough time in Exports as well and witnessed flat YoY growth. Hyundai saw a double digit degrowth as it deliberately stopped exporting its popular i10 and i20 models from India to Europe (source) and is using Turkey as its base for supplying the cars to European market. Even Renault has shifted exports to Romania to export RHD Dusters and particularly use Indian output for domestic requirement (source). However, automakers such VW & GM are strongly exploring Exports as an option to leverage on its un-utilized manufacturing capacity. Many European, African & South American countries are catered from India currently. Exports allow the OEM's to better their overall profitability and manage their operations much better.
Trivia: Exports contribute near to 20% of overall production of passenger cars.

Commercial Vehicles:
Note: Exceptional performance of Volvo-Eicher and initiation of exports of Piaggio.
Trivia: Exports contribute near to 12% of overall production of commercial vehicles (LCVs/MCVs/HCVs).

Three Wheelers:
Note: Atul betting big on exports. Bajaj makes a benchmark performance and the export volumes are just envious! TVS follows the suit and the export volumes is considerable. Piaggio recognizes the opportunity and sees a good growth. 
Trivia: Exports contribute near to 42% of overall production of three wheelers!

Note: Bajaj proves again what makes it India's most profitable OEM and sets a benchmark in 2 wheeler exports as well. Hero posts one of the highest YoY growth and depicts its plan for international markets. 
Trivia: Trivia: Exports contribute near to 14% of overall production of passenger cars.
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