Following the demonetization of high-value currency notes, the car market has seen a significant sales dip, where most manufacturers have reported negative growth. Sales of cars are generally affected in the month of December due to festive season and customers preferring to buy in the new calendar year. However, comparison with the December last year sales also show that reduced sales for major manufacturers.
Top manufacturers, Maruti and Hyundai saw a drop of 4.4% and 4.3% respectively. While Tata gained 34.4% in comparison to December 2016. Honda’s sales were down by 18.6% while Mahindra observed dip of 8.4%.
The impact of demonetization can also be gauged by the top five cars sold in December 2016 and comparing them with sales of December last year. Sales of the best-selling car Alto were down by 25.6%, while the Dzire dropped by 15%. The Swift was mildly impacted and saw a drop of 0.4% while WagonR and Grand i10 registered a drop 8.9 and 4.9 respectively. Sales drop can not be solely attributed to demonetization as there are other cars like Kwid, Ameo etc. in the segment now.
Many manufacturers have already offering discounts on cars and January is expected to be better month than December.