Aided by a sustained recovery in demand for entry-level cars, hatchbacks and utility vehicles, Maruti Suzuki India Ltd (MSI) on Thursday reported a 0.9 per cent month-on-month (m-o-m) growth in domestic wholesale to 146,203 units in March. The automaker replenished inventory at dealerships after improved retail sales over the last five months and a high waiting period on popular products also led to a substantial reduction in vehicle stocks. The country’s largest passenger vehicle manufacturer had sold 144,761 units in February.
On a corresponding basis, factory dispatches jumped substantially from March last year when the company had sold just 76,240 vehicles as production was halted due to the lockdown measures imposed to contain the outbreak of covid-19 pandemic.
Automakers had to close down their respective factories in the second half of March 2020, as the Union government imposed stringent lockdown from 18 March. Subsequently, operations remained suspended till the first week of May 2020. It took automakers another two months to come back to a normal production schedule.
The growth in wholesales on a sequential basis comes as a result of continued recovery in economic activity and customer shift towards personal mobility to avoid the covid-19 pandemic.
Hatchback and compact car sales grew by 2.27 per cent m-o-m to 106,854 units , while those of utility vehicles declined marginally by 2.2 per cent to 26,174 units.
Maruti’s exports also increased by 0.9 per cent m-o-m to 11,697 units during the month. Despite a decent recovery in retail sales, automakers such as Maruti Suzuki are concerned about the negative impact of rising fuel prices and covid infections in certain states on vehicle demand.
The company reported the highest ever production of vehicles in October expecting robust demand during the festive season. Demand for Maruti’s compact vehicles has continued to grow beyond the festive season as customers are preferring personal mobility to avoid covid infections.
Maruti’s total domestic vehicle dispatches during the FY21 declined by 6.7 per cent to 1.45 million units. This is the second consecutive year during which the company witnessed a decline in sales. The contraction in sales, though, has been contained by the rise in hatchback and compact car sales after the lockdown, and subsequent recovery in urban areas pushed sales of its utility vehicles.