India’s auto sector picks up pace as strong demand boosts sales

The Indian automotive sector is operating at a high speed in the current financial year with leading market players reporting an increase in sales of passenger cars, two-wheelers and commercial vehicles, driven by higher demand in a growing economy.

According to auto CEOs, the launch of new models, especially in the SUV segment, has led to an increase in passenger vehicle sales, while two-wheeler sales have increased due to higher incomes in rural areas.

Demand for commercial vehicles has also increased, reflecting the higher level of economic activity taking place in the economy. This is driving demand for commercial vehicles for transporting goods in both the agricultural and industrial sectors.

Leading manufacturer Tata Motors’ domestic and international sales of commercial vehicles stood at 15,224 units in June 2024 as against 14,770 units in June 2023, while in Q1 FY2025 it stood at 41,974 units as against 36,577 units in Q1 FY2024.

Girish Wagh, Executive Director, Tata Motors Ltd, said, “Domestic sales of Tata Motors commercial vehicles in Q1 FY25 stood at 87,615 units, up 7 per cent over Q1 FY24. Further, sales in June FY24 were 3 per cent higher over May FY24.

“Leading carmaker Maruti Suzuki reported a 3 per cent year-on-year growth in domestic passenger vehicle sales at 137,160 units in June 2024, from 133,027 units in June 2023. The market leader’s sales in the April-June quarter rose 1.2 per cent to 419,114 units.

Maruti Suzuki’s arch rival Hyundai also saw sales growth driven by the SUV segment. “We closed the first half of the calendar year 2024 with an overall sales growth of 5.68 per cent year-on-year. SUVs were a major contributor, accounting for 66 per cent of our domestic sales. The new Hyundai CRETA was a key driver of domestic sales in the first half of the year, selling 91,348 units – an increase of 11 per cent over the same period last year,” said Tarun Garg, COO, Hyundai Motor India Ltd.

Similarly, Mahindra & Mahindra sold 40,022 vehicles domestically in the SUV segment, up 23 per cent, and a total of 40,644 vehicles including exports. Domestic sales of commercial vehicles stood at 20,594.

According to Veejay Nakra, President, Automotive Division, M&M Ltd, “We sold a total of 40,022 SUVs in June, up 23 per cent, and a total of 69,397 vehicles, up 11 per cent over last year. June was a milestone month as we rolled out our 200,000th XUV700. We also celebrated 25 years of Bolero Pik-Ups, the category creator and market leader in the LCV segment.”

With a revival in rural demand, two-wheeler sales have picked up. Motorcycle major Bajaj Auto reported a 7 per cent rise in two-wheeler sales in the country in June at 177,207 units, compared to 166,292 units a year earlier. It also reported a 7 per cent rise in domestic sales at 582,497 units in the April-June period, compared to 542,931 units in the first quarter of FY24.

Honda Motorcycle & Scooter India sales stood at 518,799 units, up 60% year-on-year. This includes domestic sales of 482,597 units and exports of 36,202 units.

TVS Motor Company reported monthly sales of 333,646 units in June 2024, up 5 per cent year-on-year. Two-wheeler sales increased by 6 per cent from 304,401 units in June 2023 to 322,168 units in June 2024.