Maruti Suzuki auto sales growth falls to 4.8% in January as price hike bites

India’s largest carmaker Maruti Suzuki India said it sold a total of 1.51 lakh vehicles in January 2018, up 4.8% over the same period of last fiscal.

The overall growth rate, and that seen in individual segments, is below the average for the year so far. It had been reporting growth of around 14% so far in the financial year.

Maruti had announced an increase of up to 2% in prices of its models in January to account for input cost inflation, and this likely had some impact. Even though the hike may not have been substantial for smaller cars, the move was announced well in advance, which may have led to people ‘preponing’ their January purchases to December.

Domestic sales was 1.42 lakh units, up 5% on year, while exports were 10,751 units, up 2.8% on year. On average, the company had been posting domestic volume growth of around 15.5% so far this financial year.

The key volume driver of ‘compact cars’, such as Swift, Baleno, Celerio and Dzire, continued to see strong increase in sales numbers. They rose 21.6% on year to 67,868 units, compared to an average of 30% up to December.

The performance is primarily ascribed to the hot-selling new Dzire model.

Dzire may be, however, impacting the sales of its mid-segment sedan Ciaz, which saw a 23% fall in sales to 5,062 units in December. However, this was better than the numbers it has been posting in recent months.

SUVs too did well, with numbers up 27% on year to 20,693. The segment benefits from strong sales of Vitara Brezza. This too was slightly less than the average of around 33% growth that it had been posting till December.

Overall, passenger vehicle numbers increased 4.1% on year to 1.39 lakh in the domestic market.

The company also sold 1,411 units of its Super Carry commercial vehicles in January.

Maruti Suzuki continued to see customers move up to more and more expensive models, though the emergence of Dzire as a lower-priced alternative to Ciaz for some customers may have dampened the impact a little.

Last financial year, Maruti Suzuki was able to sell 1.41 of its bigger mass market cars (such as Swift and Dzire) for every small car (Alto and WagonR) that it sold.

In January this year, it sold more than twice as many of the bigger cars compared to Alto and WagonR.