Mahindra & Mahindra, the second biggest home-grown automaker in India, reported a slow down in momentum in its August auto sales after reporting strong numbers for July.
Overall sales of UVs fell to 15,786 in August from 20,797 in July.
A similar deceleration was also seen in the commercial vehicles segment, as well as in tractor sales.
In the company’s crucial commercial vehicles segment, sales decelerated sharply in the bread-and-butter sub 3.5 tonne category.
Within that, total sales of sub 2 tonne CVs fell to 1,734 from 3,793 vehicles sold in July. A similar halving was also seen in the 2-3.5 tonne category also, where sales fell to 6,595 from 13,445 in the previous month.
These numbers are also about 45% lower than what was seen in August last year.
The only area of solace is in the above 3.5 tonne category, where the company saw sales of 512 units against 428 last month and 202 in August of last year.
Exports, though not considerable, also showed greater momentum at 3180 vehicles against 1,169 in August of last year.
Tractor sales too fell to 19,997, excluding exports, from 25,769 in July and 23,503 last year.
This indicates that the strong momentum seen in tractor sales over the last 12-15 months is coming to an end. Tractor sales had been the first to bounce back after the 2020 lockdown was lifted, as farmers purchased new equipment following a strong year of agricultural production.
However, after setting all sorts of records over the last one year, they seem to be returning to more normal levels.
The boost seen in auto sales in July too could be attributed to the unleashing of pent up demand during the lock-down months of April and May, and demand for passenger cars too seem to be normalizing in August.
However, company’s Automotive Division CEO Veejay Nakra continued to be bullish.
“Demand across our product portfolio continues to remain strong with Thar, XUV 300 and our recently launched Bolero Neo and our Bolero Pik-up range clocking in impressive booking numbers. Growth momentum in exports continued with sale of 3,180 vehicles, registering an increase of 172%.
“August has been an exciting month with the reveal of the much-anticipated XUV 700 and the all-new visual identity crafted exclusively for our SUV portfolio. Supply of semiconductors continues to be a global issue for the auto industry and has been a major area of focus for us,” he said.
Hemant Sikka, President of the farm equipment division, too held out hope for strong growth in coming months.
“We saw smart recovery in overall acreage of Kharif crops with most of the key crops posting acreage levels closer to last year sown area, despite erratic monsoon in select markets. With the festive period on the anvil, which also coincides with the harvesting season, we are anticipating a robust demand in the coming months. In the exports market, we have sold 1363 tractors with a growth of 43% over last year,” he said.