India auto sales recover led by Maruti and Hero

The July auto market registered a growth in sales by 17pc from the preceding month to 1.27mn units. Sales, however, were still lower by 12pc compared to July 2019. The fall in sales compared to the prior-year period was less steep than in June, when units sold registered a drop of 30pc from June 2019. 

Maruti Suzuki recovered fairly well with 108,064 units sold in July, a decline of 1pc from the prior year June and up by 88pc from June. Hero MotoCorp, the largest two-wheeler manufacturing company posted a month-on-month growth for a third successive month after resuming operations. The company stated July was marked with volatility in the market with some cities tightening social distancing restrictions amid COVID-19. The company, however, is wary of demand trajectory sustaining given the micro-lockdowns in several parts of the country. Hero MotoCorp also appointed Rajat Bhargava as the Chairman and Pawan Munjal as the CEO recently. 

Mahindra & Mahindra pointed out at a continuous revival in demand primarily from rural and semi-urban India in their statement. The company’s sales stood at 25,678 units in July, down 36pc from the year prior but up by 33pc from June 2020. The company is ramping up production while the biggest challenge is from the supply side. 

Escort’s sales rose to 5,322 tractors in July, up 9pc from the prior year. The company faced supply chain disruptions which forced it to operate at 50pc capacity in July. Thus the company could not meet consumer demand. Operations at full capacity are expected to resume by mid-August even though the supply chain disruption is likely to continue for the next couple of months. The company’s inventory levels are low and they remain optimistic of demand as rural sentiment remains positive for tractors.