Car dispatches up in october amid strong demand

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Shipment of passenger vehicles by carmakers to showrooms rose on a fast clip last month amid continuing strong customer demand in the local market and easing of supply constraints.

Industry estimates about 337,000 units were dispatched from factories to dealerships in October, up by 29% from about 260,000 units a year earlier.

Automakers in India officially report wholesale volumes and not retail sales to customers.

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This is the third highest monthly wholesale volumes reported in the industry after September and July this year when despatches to dealerships stood at 355,000 units and 341,000 units, respectively.

Market leader Maruti Suzuki sold 140,337 passenger vehicles last month against 108,991 units in October 2021. The company said the shortage of electronic components did have a “minor” impact on the production of vehicles, mainly in domestic models, but it took all possible measures to minimise the impact.

Shashank Srivastava, senior executive director (marketing and sales) at Maruti Suzuki, said the company continues to see healthy bookings, even for CNG-powered models, and is constrained mostly in terms of production due to shortage in availability of semiconductors from one supplier. “Out of the top 10 models this month, seven are from Maruti Suzuki,” he said. “Our new launches have been received well, including for Alto K10, which has emerged as the best-seller for two straight months.”

The company has pending orders for 390,000 units, at present.

Overall, with the industry still sitting on bookings of around 775,000-800,000 units, sales are expected to remain strong for the remaining part of the fiscal year.

“There are a few headwinds and we are keeping a close watch on them,” Srivastava said.

“Inflation is high, liquidity levels have come down, and the increase in repo rates effected recently has not yet been passed on in retail financing. We have to wait and see what impact these factors has on fresh demand in future.”

Korean carmaker Hyundai reported a 30% year-on-year jump in sales at 48,001 units last month.

Tarun Garg, director (sales, marketing and service) at Hyundai Motor India, said the company’s new launches continue to see strong traction. The easing of supply constraints is enabling Hyundai to ramp up production and meet customer demand for its products. “We are set to register record domestic sales volume in CY 2022 with our proven range of super performer SUV brands,” he said.

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