India Light-Vehicle Sales Improve 12.8% in February

MUMBAI – India’s February light-vehicle deliveries jumped 17.9% over year-ago to 316,293, according to WardsAuto data.

The sharp but unexpected recovery after sluggish sales of the previous two months was led by increasing popularity of smaller SUVs and light trucks. Deliveries climbed 29.9% to 103,071 units, compared with like-2011.

The 213,222 new-car sales were more than double the SUV total, but their rate of growth was less than half at 12.8%.

Tata, Mahindra & Mahindra, Toyota and Honda saw combined deliveries of cars and SUVs improve 34.7% to 127,840 units.

Hyundai managed to score a 12.8% increase in new-car sales to 36,658, but its light-truck volumes were negligible. Its Santro brand has aged and another small car, the new Eon, has failed to reach sales targets.

The Korean auto maker’s export portfolio, huge at one time, has thinned, and it faces increasing difficulty in overseas markets for want of an attractive, suitable model.

Tata took over the No.2 spot from Hyundai in February with 39,136 deliveries, up 39.1% from year-ago.

GM India and Ford continued slipping last month, with combined sales of 14,880 units falling 9.9% from prior-year’s 16,892.

Ford is acting to arrest the decline by substantially lowering prices. For example, its new Fiesta sedan offers a discount of Rs75,000 ($1,500) to compete against the Honda City and Hyundai Verna.

Michael Boneham, Ford India president and managing director, says in a statement the

auto maker is reviewing its pricing strategy to adapt to changing market dynamics and to keep up with new launches and competition within the industry.

Ford late last month launched a 6-speed automatic power-shift variant of the Fiesta, enabling it to reach 60 mph (100 km/h) in 12.1 seconds. The auto maker plans to put more automatic versions on the market by 2015.

Maruti Suzuki is driving slowly along a recovery path in the aftermath of last year’s labor troubles. Its car sales rose 7.1% to 94,118 units, but light trucks declined 1.1% to 13,535.

Mercedes-Benz, BMW and Audi saw combined February sales increase 18.9% over like-2011 to 1,820 units. But their rate of growth was moderate in comparison with last year, when the luxury auto makers enjoyed gains of more than 30%.

Nissan’s Micra compact and Sunny sedan helped drive sales up 161.5% to 5,348 units. But exports plunged 57.3 % to 5,199, according to the Society of Indian Automobile Manufacturers.

February data compiled by SIAM showed Maruti Suzuki exports to European Union and Southeast Asian markets remained vibrant, rising 11.8% from like-2011 to 11,296 units.

Ford’s exports of its small Figo car improved 63.5% to 2,343. Despite higher sales in India, Hyundai exports declined 22.3% to 15,050.

Still pending are government decisions on the new tax structure for light vehicles and on whether to raise the price of diesel vehicles or diesel fuel. Until some clarity on those issues emerges, uncertainty will continue disrupting the market here in the months to come.