Why did Diwali become a headache for Maruti Suzuki and Tata Motors?

Auto companies expect good sales every year during the festive season, to boost sales, companies also offer great offers to customers. But this year, the concern of a decrease in demand for vehicles during the festive season has troubled auto companies. Before Diwali, auto companies had excess inventory, to clear the stock and increase demand, companies also offered huge discount offers, but still, car sales in the local market fell for the third consecutive time in September.

ET's report showed that 3.55 to 3.60 lakh cars, sedans, and utility vehicles were sold in September. Auto companies sold 3,64,000 units in the same period last year, which means 1 to 1.25 percent fewer units were sold in 2024 compared to 2023. Passenger vehicle sales declined by 1.8 percent in August and 2.5 percent in July. Auto companies like Maruti Suzuki, Tata Motors, and Hyundai have seen a decline in sales last month.

What do the October sales figures say?

October sales figures have started coming in, Maruti's sales in October have increased by 3.6 percent compared to last year. On the other hand, Mahindra sold 96,648 units in the last month of October. While October was great for Maruti and Hyundai, on the other hand, Tata Motors' total sales in October registered a slight decline, the company has sold 82,682 units in domestic and international markets which is less than 82,954 units in the same period last year.

S&P Global Mobility Director Puneet Gupta says that the demand for cars priced between Rs 10 lakh and Rs 25 lakh was increasing for the last two-three years, but now there has been a sudden decrease in this range. But the demand for cars in the premium segment is still slightly better. Maruti Suzuki Chairman says that the decline in car sales in the first half of the current financial year is not a matter of concern, but the continuous decline in demand for cars cheaper than Rs 10 lakh is worrying.

How was the sales situation in September?

Maruti Suzuki's sales in September fell by 4 percent to 144,962 units, while Hyundai's sales also fell by 5.8 percent to 51,101 units. Talking about Tata Motors, Tata's passenger vehicle sales fell by 8 percent to 41,063 units.