June: Car sales slowdown - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

June: Car sales slowdown

Aug 10, 2000

All the major car manufacturers have seen a slowdown in car sales in the June 00 over May 00. Even though on a year on year basis most have reported robust growth rates, there seems to be a slowdown in the current year. As can be seen from the table below, Daewoo Motors have reported a strong growth in volumes in June 00 over June 99 by 82%, however as compared to May 00 this is a decline of 25.7% YoY.

car volumes slowdown
Nos. June'00 June'99 May'00 YoY %
change
MoM %
change
Maruti 14,715 23,469 25765 -37.3% -42.9%
Telco 4,096 3,656 5177 12.0% -20.9%
Hyundai 6,116 4,634 7561 32.0% -19.1%
Honda City 801 750 903 6.8% -11.3%
Daewoo 4,702 2,584 6325 82.0% -25.7%
As Maruti's sales for June'2000 are only for 15 days, they are not comparable to others.

Considering that YoY growth still continues to be strong, the car segment continues to do well, however the slowdown could be a sign of worry. If we were to take the combined figures of April and May' for both the years as given in the table below, the growth remains robust in the current year due to exceptionally strong volumes in May 00 as compared to May 99.

  April-May-'2000 April-May'99 % change
Maruti 40,480 57,591 -29.7%
Hyundai 13,677 9,153 49.4%
Honda City 1,704 1,476 15.4%
As Maruti's sales for June'2000 are only for 15 days, they are not comparable to others.

However this slowdown in June is a cause of concern as in the previous year, for the period June 99 over May 99 most companies reported a small growth in volumes, as compared to a fall in the current year.

The reasons for this slowdown in the passenger car market as is in other segments of the automobile industry in the current year, is imposition of uniform sales tax. However the future looks bright for the passenger car segment with lower interest rates, availability of attractive car finance schemes, improvement in the economy and pick up in the second hand car market. Price increases have been minimal especially in the small car segment as competition is intense, this should continue to spur the volume growth in this segment.


Equitymaster requests your view! Post a comment on "June: Car sales slowdown". Click here!

  

More Views on News

TATA MOTORS Announces Quarterly Results (2QFY20); Net Profit Up 117.4% (Quarterly Result Update)

Oct 29, 2019 | Updated on Oct 29, 2019

For the quarter ended September 2019, TATA MOTORS has posted a net profit of Rs 2 bn (up 117.4% YoY). Sales on the other hand came in at Rs 654 bn (down 9.3% YoY). Read on for a complete analysis of TATA MOTORS's quarterly results.

TATA MOTORS Announces Quarterly Results (1QFY20); Net Profit Down 58.4% (Quarterly Result Update)

Jul 29, 2019 | Updated on Jul 29, 2019

For the quarter ended June 2019, TATA MOTORS has posted a net profit of Rs 34 bn (down 58.4% YoY). Sales on the other hand came in at Rs 615 bn (down 8.4% YoY). Read on for a complete analysis of TATA MOTORS's quarterly results.

TATA MOTORS 2018-19 Annual Report Analysis (Annual Result Update)

Jul 5, 2019 | Updated on Jul 5, 2019

Here's an analysis of the annual report of TATA MOTORS for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of TATA MOTORS. Also includes updates on the valuation of TATA MOTORS.

More Views on News

Most Popular

How the 8-Year Cycle Can Help Identify Multibaggers (Fast Profits Daily)

Sep 11, 2020

This is how you can apply the greed and fear cycle in the market to pick stocks.

Why We Picked This Small-cap Stock for Our Hidden Treasure Subscribers (Profit Hunter)

Sep 17, 2020

This leading household brand will profit big time in a post covid world.

This Could Be the Best September for Auto Stocks (Profit Hunter)

Sep 11, 2020

Here's why I think this month could be a great for auto stocks.

What Do the Charts Say About Buying Smallcaps Now? (Fast Profits Daily)

Sep 18, 2020

Everyone seems to be excited about buying smallcaps now...but is it the right thing to do? What do the charts tell us? Find out in this video...

More

Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms

TATA MOTORS SHARE PRICE


Sep 22, 2020 (Close)

TRACK TATA MOTORS

  • Track your investment in TATA MOTORS with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

TATA MOTORS 8-QTR ANALYSIS

COMPARE TATA MOTORS WITH

MARKET STATS