A Mixed Bag Overall
In January 2024, auto sales rose, especially in passenger vehicles, thanks to SUV sales and Maruti’s entry-level cars rebounding. After reducing stock at dealers in the last months of 2023, companies refilled inventories in January.
Two-wheeler sales grew, driven by premium models and rural demand from weddings. However, commercial vehicle sales dropped, partly due to fewer government orders and a strong previous year.
Tractor sales were low but might improve. Exports, except for Maruti Suzuki, faced challenges due to Red Sea issues. Some automakers raised prices in early 2024 due to higher costs, expecting demand to remain strong for premium and entry-level vehicles supported by offers.
In January 2024, the car market in India saw significant sales growth, especially for SUVs and compact cars, leading to an overall increase in wholesale numbers.
Maruti Suzuki led with a 16% rise in sales, while Tata Motors and Mahindra & Mahindra also saw big jumps. Hyundai and Toyota made notable gains too. Despite this surge, retail sales grew more modestly.
Discounts on cars went down from the previous month, but were still higher than last year, and price increases were modest. Mahindra & Mahindra, with a large backlog of orders, is expected to grow faster than others in the coming year but might need to increase production capacity to meet demand.
In January 2024, India’s two-wheeler (2W) market saw over 20% growth compared to last year, mainly because of consistent demand within the country.
Hero MotoCorp and TVS Motor experienced significant sales increases, while Royal Enfield’s growth was smaller due to a drop in exports. Bajaj Auto’s sales jumped by 28%, thanks to strong local demand and the introduction of new models and upgrades.
This trend suggests two-wheelers could outperform other vehicle segments in terms of growth from 2023 to 2026.
In January 2024, India’s commercial vehicle (CV) market saw a slight decrease in sales compared to last year, with Tata Motors and Ashok Leyland both reporting drops, mainly in heavy and small commercial vehicles.
However, bus sales went up significantly. Despite the recent dip, there’s optimism for future sales due to strong demand signals and economic growth. Expectations are for a short-term softness around the general elections, but a strong rebound in CV sales is anticipated from the next fiscal year, driven by economic activities and resumed industry tenders.
India’s tractor sales dropped by 13% due to fewer farm activities, with key companies like M&M and Escorts seeing decreases in their sales.
This downturn is linked to late harvests and less planting for the Rabi season. M&M remains hopeful for a rebound, banking on a good Rabi harvest and government support for farming, while Escorts expects sales to pick up in the coming months as planting improves and the harvesting season gets underway.
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