Maruti Suzuki sales double compared to last year, Tata Motors and Mahindra close the year on a high
- Tata Motors and Mahindra & Mahindra saw exponential growth in sales compared to March last year.
- The auto companies saw their sales recover after a year of sluggish sales due to the COVID-19 pandemic, so their full year growth was still slow compared to pre-pandemic years.
- The share prices of companies like Maruti Suzuki, Tata Motors jumped as the numbers were out.
|Company||March 2021 (domestic + export)||March 2020 (domestic + export)|
|Tata Motors||66,609 (only domestic)||11,012|
|Mahindra & Mahindra||16700 (only domestic)||3383|
The exponential growth in car sales for Maruti or Tata Motors wasn’t a big surprise. On a year-on-year basis, the massive jump was also seen as last year March sales had been impacted due to the COVID-19 pandemic and the beginning of lockdown.
The growth in the auto sales in March can also be attributed to the fact that government employees rushed to buy cars to avail the leave travel concession (LTC) benefits before the March 31 deadline. Through the LTC scheme, government employees have to spend an amount which is equal to three times the amount available through LTC. For example, any employee who can avail ₹1.35 lakh under LTC has to spend at least ₹4.05 lakh. So government employees who didn’t want to forego the benefit looked at buying cars as an option.
“The LTC scheme benefit has acted as a strong stimulus for growth by bringing in many first-time buyers. It has also provided many an opportunity to replace their vehicles with new ones, as per our experience, with many government employees preferring the all-new Nissan Magnite. It’s a strong government initiative and should be continued to drive personal mobility especially when public transport is seeing challenges with the COVID-19 pandemic,” Rakesh Srivastava, managing director of Nissan Motor India, told ET Auto on March 23.
Indian automobile majors were already squeezed by slowing sales for over a year, before the pandemic struck a nearly fatal blow. While the market has welcomed the recovery from the depths seen in 2020, the demand for automobiles in India is still far from its potential.
|Company||Share price as of 1.30 pm|
|Mahindra & Mahindra||-0.29%|
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