While commercial vehicles and passenger vehicles have maintained growth in January despite demonetisation, the two-wheeler industry, which is driven by rural economy, continues to be under pressure.
While SIAM numbers are awaited, industry sources said M&HCV grew by around 1% while passenger cars sales grew in double digits. Domestic two-wheeler sales dropped by around 7% to around 12.62 lakh in January 2017 from around 13.63 lakh, a year ago.
The impact was seen more on companies, which got major exposure to motorcycles. Despite two-wheeler makers reducing the down payment, the sales could not catch up.
Bajaj domestic motorcycles sales dropped 15 % to 119,803 in January as compared to 140,853 units a year ago. Hero MotoCorp's sales dropped by 13% to 487,088 units in January, 2017 from 563,348 units in January, 2016. TVS Motor sales dropped to 207,059 units in January 2017, down from 208,485 units sold in the same month a year ago, mainly due to drop in motorcycle sales, while scooter sales grew by 12 per cent.
Among the top players, it was only Honda that saw growth in sales, which rose by around two per cent to 368,145 units in from 361,721 units, a year ago.
Yadvinder Singh Guleria, Senior Vice President - Sales & Marketing Honda Motorcycle & Scooter India Pvt. Ltd, said post the demonetisation while the there has been a recovery in urban areas, rural and agrarian economies continue to be under pressure which is pulling motorcycle sales down. He noted, around 80 per cent of the sales in rural are motorcycles.
On Honda's performance, he said it was driven mainly by scooters, new product launches, additional capacity, increase in network and marketing.
Guleria said the company also worked with financiers to ease burden on retailers and customers. He expects the rural market to come by April end.
Passenger vehicles drive smooth
Passenger vehicle volumes have recovered sharply in January 2017 and they reckon the industry likely grew by double digits year-on-year.
Most of the large OEMs have reported strong y-o-y growth in wholesale volumes. For Maruti, domestic volume grew by 25.9 per cent to 133,934 units in January 2017 from 106,383 units in January 2016.
Hyundai's domestic sales grew by 10.5 per cent to 42,017 units from 38,016 units. Toyota Kirloskar's reported a 21 per cent increase in domestic sales at 10,336 units. Nissan saw 62.89 per cent rise in January sales at 4,346 units from 2,668 vehicles sold in January 2016. Tata's passenger vehicles sales in India grew 21 per cent to 12,907 units.
Though CV market reported only one per cent growth, experts point out one should remember base of the industry is high. CV sales in January were driven mainly by pre-buying demand ahead of change in emission norms in April 2017.