January auto sales expectation: Car volumes may grow 21% from last year, two-wheeler demand may weaken

Car sales in India are likely to register healthy growth in January 2023, amid a healthy order book and increased production, a Nomura report has suggested. The research agency expects car, or passenger vehicle (PV), demand to remain skewed towards sports utility vehicles (SUVs) and premium variants.

According to the Nomura research, car volumes are likely to go up 21 percent year-on-year (YoY), while the medium and heavy commercial vehicles (MHCVs) are expected to rise 26 percent YoY. It suggested that two-wheeler demand may weaken and dive 28 percent from its peak in January 2018.

Among original equipment manufacturers (OEMs), India’s largest carmaker Maruti Suzuki is likely to see its total volumes increase 13 percent at 1.74 lakh in January 2023 as against 1.54 lakh units in the same month last year.

Tata Motors, on the other hand, is likely to see its volumes grow 10 percent YoY at 84,000 versus 76,200 units. Mahindra Auto’s total volumes are expected to grow 35 percent in January 2023 at 63,000 units compared to last year’s 46,800 units.

India’s largest two-wheeler maker, Hero MotoCorp, is expected to see 8 percent growth in sales at 4.10 lakh in January 2023, as against 3.8 lakh units in January 2022. Chennai-based two-wheeler major TVS Motor Company is likely to see its total volumes increase by 9.6 percent YoY at 2.92 lakh units against 2.66 lakh units in the same month last year.

Bajaj Auto is expected to see its total volume drop 17 percent at 3.03 lakh units compared to 3.63 lakh units sold in January 2022.

Commercial vehicles major Ashok Leyland’s total volumes are likely to go up 26 percent at 17,500 units in January 2023, as against 13,900 units in the same month in 2022.

Meanwhile, another research agency Emkay Global expects car sales in January 2023 to end up higher largely because of OEMs like Maruti Suzuki, Eicher Motor, Ashok Leyland, and Escorts. It noted that the CVs are likely to maintain double-digit growth and estimated a positive growth in two-wheelers sales supported by the festive season (Uttarayan) and marriage season demand.

According to the Emkay report, total car sales may see a 12 percent YoY growth. It expects Mahindra Auto’s domestic volumes to grow by 55 percent YoY, Tata Motors’ sales to increase by 10 percent, and Maruti Suzuki to grow 8 percent in January 2023.

It said CV volumes are likely to grow 13 percent YoY amid robust demand and transporters were buying trucks to get goods and services tax (GST) input credit and preponing purchases before the implementation of the Real Driving Emissions (RDE) and OBD2 norms.

The research agency expects Eicher Motor-Volvo Eicher CVs to increase 49 percent YoY, Ashok Leyland to grow 41 percent, Tata Motors CV segment to move up 6 percent, and Mahindra to grow 4 percent in the domestic space.

Emkay Global predicts that domestic two-wheeler sales to improve 7 percent YoY and expects domestic sales to increase by 29 per cent for Royal Enfield, 16 percent for TVS, 8 percent for Hero MotoCorp, and around 2 percent for Bajaj Auto.