Opinion What do LCV sales portend?

September auto sales data can broadly be termed as disappointing,pretty much in line with the lacklustre numbers that Indias automobile sector has been throwing up over the past several months.

October 6, 2012 12:56 AM IST First published on: Oct 6, 2012 at 12:56 AM IST

September auto sales data can broadly be termed as disappointing,pretty much in line with the lacklustre numbers that Indias automobile sector has been throwing up over the past several months. The slowdown in sales,earlier visible across the passenger vehicle,medium and heavy commercial vehicle and three-wheeler segments,seemed to have spread now to the two-wheelers segment as well an indication of the dampening sentiment among consumers.

The one bright spot,though,has been the sharp pick-up in sales in the light commercial vehicle (LCV) segment. According to industry figures,LCV sales in the month of September have registered a 23.3 per cent YoY growth,second only to the 28 per cent growth registered by utility vehicles (UVs). This,despite the sharp Rs 5 hike in diesel prices in mid-September.

The LCV sales trend counts as important,largely because commercial vehicle sales are seen as a proxy for the investment sentiment in the broader economy,along with sectors such as capital goods. So to that extent,the uptick in the LCV sub-segment is certainly a big positive. The rise in the UV sales,on the other hand,can primarily be attributed largely to three models Renault Dustar,Maruti Ertiga and M&M XUV 500,of which two were brand new launches.

While,the overall sales trend,with only automakers Maruti Suzuki and Mahindra & Mahindra (M&M) holding their ground in a widely disappointing show by the auto makers,fuelled to a large extent by the high interest rates and rising auto fuel prices,the turnaround in the LCV segment denotes the fact that the investment sentiment in the real economy could well and truly be on the rise. The coming months will prove if this trend is here to stay.

Sanjay is an Assistant Editor based in New Delhi. sanjay.bhattacharya@expressindia.com

# columns

Opinion What do LCV sales portend?

September auto sales data can broadly be termed as disappointing,pretty much in line with the lacklustre numbers that Indias automobile sector has been throwing up over the past several months.

September auto sales data can broadly be termed as disappointing,pretty much in line with the lacklustre numbers that Indias automobile sector has been throwing up over the past several months.