Tag: Passenger Vehicles

Why passenger vehicles will continue to grow in low single-digits this year

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The passenger vehicle (PV) industry has grown at a modest pace in April, and the trend is likely to continue for the rest of the year.

Tarun Garg, COO of Hyundai Motor India, and Hemal Thakkar, Director at CRISIL, who watches the auto space closely, expect low single-digit growth of about 2-3% for the PV industry during April-March 2024-25.

Garg says the slow pace of growth should not be a cause for worry because of two reasons: one, it’s coming on a high base, and two, the compound annual growth rate (CAGR) of the industry over the past decade has also been around 5%.

Thakkar notes that the inventory position is also still tight. “We’re still at about 40 days of inventory that will limit our growth going forward.”

However, within the PV industry, the Sport Utility Vehicle (SUV) segment has seen a solid growth.

With newer models coming in, Garg expects this space to remain on an uptrend.

“I think SUVs are continuously going to grow. And I don’t buy the argument that just because the smaller cars or entry level is not growing, it is having an effect on the overall industry growth. I think that industry growth has been phenomenal. And people are directly moving to SUVs, which is very clearly seen. The first timers in SUVs is going up,” he points out.

Garg also pointed to an interesting trend in the PV segment, where SUV’s are increasingly selling in the rural market.

The South Korean auto giant and India’s second largest carmaker is also optimistic of a strong growth in the electric vehicles (EV) space and has plans to launch five new EVs by 2030.

The first high-volume Hyundai EV is likely come in early 2025.

Garg believes when it comes to EVs, the direction is clear that they are going to be the future.

However, one needs to be patient as the industry might face teething troubles in terms of charging infrastructure. The absence of bigger, more established players will also affect momentum possibly for another year or two.

Thakkar agrees with Garg that EVs are the way forward although there will be challenges in the near term.

However, he also notes that the increasing availability and variants of EVs and the government’s initiatives to promote EV manufacturing will build confidence among customers to opt for it.

For hybrids cars, Thakkar believes the deciding factor will be the price point. If the delta of its price with petrol cars is low, customers will opt for it.

Watch the accompanying video for the full interview

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

From PVs to CVs to hydrogen fuel, here’s what leaders from Tata Motors said at Auto Expo 2023

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Homegrown automotive manufacturer Tata Motors, which has the biggest stall at the expo this year, launched a range across the electric vehicle, passenger vehicle, and commercial vehicle segments, along with new concepts for the future.

Tata Motors’ passenger vehicle division showcased Avinya EV, Harrier.EV, Sierra.EV, Taigo.EV Blitz, Curvv concept, Altroz Racer, Altroz iCNG, Punch iCNG and dark editions of its existing SUVs, Harrier and Safari. Furthermore, its commercial vehicle segment revealed Magic EV, the Prime e28, ultra e.9 as well as the Hydrogen Fuel Cell truck at the Auto Expo 2023.

New mobility and future

Natarajan Chandrasekaran, Chairperson of the Tata Group, in an interview with CNBCtv18, said, “Both in commercial vehicles and passenger cars, we are driving towards new mobility, and we are investing in several technologies. You have seen us launch many electric vehicles, passenger cars and commercial vehicles. You must see what we do in fuel cell and hydrogen-powered internal combustion engine vehicles.”

“We are looking at urban mobility as well as long-distance trucking. In passenger cars, we are investing both in internal combustion and electric vehicles. We had a lot of product gaps which we are trying to address. So, it’s a question of safety and a question of taking a bet on electric mobility, which we took in 2018-19. Since then, we have only doubled and tripled our efforts,” added Chandrasekaran.

Also Read | Auto Expo 2023: Maruti Suzuki unveils concept electric SUV eVX with 550 km driving range

When asked about the company’s plans to bring down costs of its electric mobility products, the chairperson of the Tata Group said, “We need to do play in all ranges, not just sub-10-lahk. We need to have higher-end models as customers have different choices, and there are different segments of customers. We need to continue working on batteries and new technologies. Currently, we are working with lithium-ion, and we need to look at other technologies as well. We are working with startups and innovators, and this space will evolve.”

Passenger vehicles

Shailesh Chandra, President of Tata Motors Passenger Vehicles, in conversation with CNBCtv18, said that a lot of pent-up demand in the market has been released and therefore, the company sees more demand than supply. He added that with bookings sustaining for popular models.

Industry growth in FY24 is likely to be in single digits when compared to this fiscal’s 25 percent rise, revealed Chandra adding that as the market demands more SUVs, the company’s focus will continue on passenger vehicles and EVs.

He also stated that Tata Motors is looking to launch Avinya towards the end of 2025, Harrier.EV in 2024 and Sierra.EV in 2025. Both Curvv EV and its ICE (internal combustion engine) versions will be launched in 2024.

Also Read: Tata Motors at Auto Expo 2023: Auto major unveils Sierra, Harrier EVs and more

Tata Punch CNG And Altroz CNG, on the other hand, will be launched in 2023. Chandra also revealed that the company had given higher boot space in Punch CNG to avoid any comprise in the vehicle’s luggage space.

Commercial vehicles

Girish Wagh, Executive Director of Tata Motors Commercial Vehicles, while talking to CNBC-TV18, said that the logistics industry contributes 18 percent to greenhouse emissions globally. He added, “With our goal to achieve net-zero emissions by 2045, we are transforming mobility by re-imagining our entire product portfolio, value chain and operations.”

The company is uniquely positioned to offer in every segment multiple green fuel options — natural gas, electric, and hydrogen, he added. Wagh stated that Tata Motors aims to lead the EV journey while adding that it looks like India will balance the energy basket as it moves from conventional fuel to hydrogen.

While hydrogen is an exciting possibility in commercial vehicles, battery EVs will most likely be introduced to the market first, revealed Wagh and added that fuel cell electric buses will start running commercially from the next financial year.

Wagh said that “We are very optimistic about the Green Hydrogen Mission and have been investing Rs 1,500-2,000 crore per year in our CV business. Every year, our tech spend is increasing.”

FY23 has been a good year for the CV industry, and the industry has seen volume growth of 45 percent this year, he added while remaining optimistic about growth next year.

Auto Expo 2023 LIVE updates: Toyota showcases Corolla Cross H2 concept car, Maruti Suzuki unveils Jimny and SUV Fronx

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Passenger vehicle dispatches rise 11% in July as chip shortage eases

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The passenger vehicle dispatches to dealers rose by 11 percent to 2,93,865 units in July as semiconductor supply issues eased, resulting in companies ramping up production ahead festivals, the data released by the Society of Indian Automobile Manufacturers (SIAM) showed. The passenger vehicle dispatches stood at 2,64,442 units in the same month last year.

According to SIAM, the passenger car dispatches rose 10 percent to 1,43,522 units last month while utility vehicle dispatches went up by 11 percent to 1,37,104 units. Van dispatches rose to 13,239 units from 10,305 units in the same month last year.

The total two-wheeler dispatches are up 10 percent to 13,81,303 units as compared to 12,60,140 units last year. Among two-wheelers, scooter wholesales climbed to 4,79,159 units against 3,73,695 units and motorcycle wholesales increased to 8,70,028 units compared to 8,37,166 units during July 2021.

Three-wheeler dispatches also increased  sharply to 31,324 units from 18,132 units a year earlier.

It is to be noted that these are numbers of dispatches to dealers by companies and not the final sales to customers.

The total production of passenger vehicles, three wheelers, two wheelers and
quadricycles last month was 2,197,954 units.

According to Rajesh Menon, Director General, SIAM, market for entry level passenger cars, two-wheelers and three-wheelers are yet to recover. Sales of two-wheelers last month were still below July 2016 numbers and sales of three-wheelers were still below July 2006 numbers.

“Third hike in a repo-rates in a row, to rein in high inflation, will make Auto loans costlier, making it more difficult for entry level vehicles to recover,” he said.

On the government’s decision to allocate a higher amount of domestic gas for the CNG segment, he said, “This would significantly bring down the input cost of gas companies. We hope that in line with the Government’s intent, the gas companies would pass on the entire benefit to the end consumers by reducing retail CNG prices.”

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Passenger vehicle dispatches slow down in April as supply challenges remain: SIAM

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Passenger vehicle dispatches from factories to dealers in the domestic market declined by 4 percent in April as supply-side challenges continued for the automotive industry, industry body SIAM said on Wednesday. Total passenger vehicle domestic wholesales stood at 2,51,581 units last month as compared to 2,61,633 units in April 2021.

Passenger car dispatches stood at 1,12,857 last month as against 1,41,194 units in the same month last year. Utility vehicle wholesales however increased to 1,27,213 units from 1,08,871 units in the year-ago period.

Van dispatches remained flat at 11,511 units in April as against 11,568 units in April 2021. Two-wheeler sales increased by 15 percent to 11,48,696 units last month as compared to 9,95,115 units in April 2021.

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Motorcycle sales increased to 7,35,360 units as against 6,67,859 units in April 2021. Similarly, scooter dispatches rose to 3,74,556 units last month as compared to 3,01,279 units in the year-ago period. Three-wheeler wholesales also increased to 20,938 units last month as against 13,856 units in April 2021.

“Sales of passenger vehicles is still below the April 2017 figures, while two-wheelers are even below the April 2012 figures,” SIAM Director General Rajesh Menon noted. He added that three-wheelers are yet to reach normal levels, as sales are still less than 50 percent of April 2016 figures.

Also Read | Favourable demand conditions to drive double-digit growth in commercial vehicle industry: Tata Motors

Manufacturers are working hard to manage the supplier ecosystem with agility and flexibility, as supply-side challenges continue for the industry, Menon stated. “Further, manufacturers are also monitoring the likely impact on demand, due to the recent hike in repo rate, as it would increase the lending rates to the customers,” he said.

Earlier this month, the Reserve Bank of India had increased the repo rate, the rate at which it lends to commercial banks, by 40 basis points to 4.4 percent in a bid to contain inflation that crossed 6 percent for three successive months.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Passenger vehicles sales dip 19% in Nov as chip shortage woes continue: SIAM

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Passenger vehicle wholesales in the country declined by 19 percent  in November as the semiconductor shortage continued to impact vehicle production and subsequent deliveries to dealer partners, auto industry body SIAM said on Friday. The passenger vehicle (PV) dispatches last month stood at 2,15,626 units, down 19 per cent from 2,64,898 units in November 2020.

Similarly, total two-wheeler sales declined sharply by 34 per cent to 10,50,616 units last month from 16,00,379 units in the year-ago period. Total three-wheeler dispatches stood at 22,471 units, down 7 per cent from 24,071 units in November 2020. Total automobile sales across categories drooped to 12,88,759 units last month compared to 18,89,348 units in the year-ago period.

“Industry continues to face headwinds due to global semi-conductor shortage. In the festive season, industry was hoping to make up for the lost ground, but the sales in the month of November 2021, were the lowest in seven years for passenger vehicles, the lowest in 11 years for two-wheelers and the lowest in 19 years for three-wheelers,” Society of Indian Automobile Manufacturers (SIAM) Director General Rajesh Menon said in a statement. Amidst the rising threat of Omicron, the new Covid variant, industry is pro-actively ensuring employee safety and monitoring any supply chain hiccups, he added.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Maruti to benefit most once chip shortage issue gets resolved: LKP Securities

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The auto sales numbers for the month of September have been a mixed bag. Discussing the numbers in detail, Ashwin Patil, research analyst, LKP Securities, is of the view that the numbers were weak and on expected lines because of chip shortages that have been plaguing the passenger vehicle players. However, Patil expects Maruti to be the best player to take advantage of the burgeoning demand once the semiconductor shortage issue gets sorted out.

Patil said, “The sales decline in September was quite expected for Maruti as well as M&M because the semiconductor manufacturers are facing the crunch. But going forward, once this issue gets sorted out,s Maruti will be the best player to take advantage of the burgeoning demand.”

“Channel checks with dealers suggest that demand is seriously increasing, the footfalls, enquiries and conversion rates are quite high and people are ready to wait for good models of Maruti, M&M and Tata even if the waiting period is as high as eight to nine months. This tells us how strong the demand is, so once the chip shortage issue gets sorted out, these players will come back into the forefront,” he specified.

On demand for two-wheelers and passenger vehicles, Patil said, “The demand and supply are moving in exactly opposite directions for both these segments. For passenger vehicles, demand is not an issue but for two-wheelers, demand is definitely an issue. Since BSVI got implemented last year, the two-wheeler makers had taken a lot of price hikes and that has hurt sentiments in the mass segment as well as the executive segment of two-wheelers. Secondly, last year after the COVID wave subsided, the two-wheelers were the first to bounce back and that has made the base quite high. So, these are the reasons due to which the two-wheeler demand is not as per expectations.”

According to Patil, tractors are moving quite steadily. “Over the last couple of months, the rains were extreme in certain states and scanty in certain other states. So that is the reason why tractors are not performing well. However, on a high base of last year, definitely, we expect tractors to post mid-single-digit kind of growth this year. It is not as bad as two-wheelers, where demand continues to be an issue,” he mentioned.

For Hero MotoCorp, the two-wheeler September numbers have crossed over 5.3 lakhs. So they seem to be doing better but for Eicher Motors on the other hand, there seems to be no end to their struggles.

Also Read: Bajaj Auto says mid-market segment to lead growth in festive season; chip shortage still a worry

Patil said, “As far as two-wheelers and Hero MotoCorp is concerned, we have seen that the rural demand got hurt because of the second wave of COVID which penetrated deeper into the country and that hurt demand but this month maybe, we are seeing some green shoots in the rural demand. Going forward, the Rabi crops are expected to be good and there has also been some recovery in monsoon towards September end, so maybe that could be the reason why Hero is performing better than expected. On the other hand, for Eicher Motors, the demand is getting hurt, maybe the production is also getting hurt because they are present more in the premium bikes segment and that is the reason why chip shortage is there, also why their Royal Enfield business is getting hurt.”

For more, watch the video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Passenger vehicle wholesales in India rise 45% in July; two-wheeler sales fall 2%: SIAM

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Passenger vehicle wholesales in India increased by 45 percent to 2,64,442 units in July as compared to 1,82,779 units in the same month last year, auto industry body SIAM said on Thursday.

According to the latest data by the Society of Indian Automobile Manufacturers (SIAM), two-wheeler dispatches from the OEMs to dealerships during July fell 2 percent to 12,53,937 units from 12,81,354 units, YoY.

Motorcycle sales declined 6 percent to 8,37,096 units last month from 8,88,520 units, while scooter sales saw a growth of 10 percent at 3,66,292 units as against 3,34,288 units a year ago.

Three-wheeler sales rose 41 percent to 17,888 units from 12,728 units, YoY.

The industry body said it was keeping a close eye on the third wave of COVID-19 in the country. The auto industry continues to face semiconductor chip shortages and headwinds of high commodity prices, it said.

Also Read: Bajaj Auto likely to lose 50% of domestic sports motorcycle volumes in September: Rajiv Bajaj

Meanwhile, total Utility Vehicle sales in July jumped to 1.24 lakh units as compared to 71,384 units sold in July last year.

The total sales across categories, excluding commercial vehicles, rose to 15,36,269 units compared to 14,76,861 units in July last year.

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

June auto sales data: Here’s what to expect

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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June auto sales data will be released on Thursday and ahead of that, most brokerages are expecting good sales this time around. Enquiries have picked up in June as dealerships opened up.

The passenger vehicles segment could gain the most because of the rise in personal mobility.

According to Nomura’s estimates, on a month-on-month basis, Maruti is expected to see a 217 percent jump and about 1.48 lakh units versus about 46,000 in May.

Bajaj Auto as well is going to see a good growth of 27 percent month-on-month basis because of the boost in exports. So, 3.44 lakhs is what Nomura is working with.

Ashok Leyland sales are expected to double on a year-on-year basis and improve for the 12th straight month on a month-on-month basis.

Watch the accompanying video of CNBC-TV18’s Sonia Shenoy for more details.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow