(Reuters) -Three of India’s top four carmakers reported weak sales to dealers in April, company data showed on Thursday, as buyers delayed purchases amid concerns about slowing economic growth.
Market leader Maruti Suzuki posted a marginal 0.6% year-on-year rise, while Hyundai Motor (OTC:HYMTF) India and Tata Motors (NYSE:TTM) clocked declines of 11.6% and 5.1%, respectively.
Mahindra & Mahindra (NSE:MAHM), in contrast, reported a near 28% jump in monthly sales, aided by strong demand for its ’XUV 3X0’ and five-door ’Thar’ SUVs.
That helped the ’Scorpio’ maker overtake Hyundai and Tata Motors to the no. 2 spot in India’s car market for the second time this year.
The four automakers together account for 80% of a market that saw record sales of 4.3 million units last year. Their combined sales were up about 1.4% in April, led largely by Mahindra.
WHY IT MATTERS
India’s auto sector makes up 7% of GDP and is a major employer.
The country’s economic growth is seen slowing down, with the central bank projecting full-year GDP growth of 6.5% for fiscal 2025, lower than the 9.2% recorded the year before.
KEY CONTEXT
Car sales are cooling as the post-pandemic pent-up demand, which propelled sales to record highs in past years, has faded. Growth slowed to 2% in financial year 2025, from 8% the previous year and 27% in fiscal 2023, with industry experts attributing the moderation to a broader economic slowdown.
Manufacturers expect car sales to grow 1%-2% this year, although some analysts expect growth to pick up by June or September on lower interest rates and a cut in personal income tax.
Phillip Capital said that buyers were postponing purchases, with the trend likely to continue for up to four months.
Maruti has held up better due to SUV demand and fleet sales, while Hyundai and Tata have struggled amid fewer new launches as they derive two-thirds of their sales from SUVs.
BY THE NUMBERS
Manufacturer Domestic Sales Growth (%)
(units)
Maruti Suzuki 138,704 0.6
Hyundai Motor India 44,374 -11.6
Tata Motors 45,532 -5.1
Mahindra & Mahindra 52,330 27.6
Toyota (NYSE:TM) Kirloskar 24,833 32.8
Motor
Kia India 23,623 18.3
MG Motor India 5,829 23