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Informist, Wednesday, Sept. 3, 2025

 

NEW DELHI – Wholesale sales of passenger vehicles fell over 2% on year in August as original equipment manufacturers held back supplies to dealers on worries of customers deferring purchases as they await a cut in goods and services tax. The cumulative shipment of passenger vehicles in August to dealers by Maruti Suzuki India Ltd., Mahindra & Mahindra Ltd., Hyundai Motor India Ltd., and Toyota Kirloskar Motor Pvt. Ltd. was at 307,113 units, compared with 314,328 units a year ago.

 

All the companies, barring Toyota Kirloskar, reported a fall in despatches on year. On a monthly basis, wholesale sales fell over 3%. "PV (passenger vehicle) despatches were weak across the pack owing to muted underlying trends, deferment of potential demand due to the upcoming GST cut, and higher channel inventory," Emkay Global Financial Services said in a note Tuesday.

 

Indian automobile manufacturers saw better sales of their cars abroad in August. Maruti Suzuki's export sales grew 41% on year and Hyundai Motor's export sales grew 21% on year. Exports of passenger vehicles, which form a minuscule portion of the overall sales of Tata Motors, grew to 2,314 units in August from 344 units a year ago and 654 units in July.

 

Ahead of the expected rationalisation of GST rates, companies tweaked supplies to dealerships to help keep their inventories in check. "I think many of the OEMs (original equipment manufacturers) have taken a stance that let the wholesale be done based on the dealer request," Partho Banerjee, Maruti Suzuki's executive director, told reporters Monday.

 

Banerjee hoped this recalibration would benefit the company in the festival season. "We have pending bookings close to almost 150,000 in our network, so we are very hopeful once the GST reforms are announced we are going to see good retail (sales) in the market," he said.

 

The move by automobile companies aimed at strategic inventory management ahead of the expected festival season could benefit some segments more than others, according to Nirmal Bang Institutional Equities. "While hatchbacks, sedans, and other small cars continue to face challenges, a possible GST reduction could significantly lift the entry-level car segment, which is currently burdened with 28-31% tax," it said in a note.

 

Discounts on passenger vehicles remained at an increased level in August, in an attempt to reduce existing inventories at the dealership level. Dealers offered discounts of up to INR 150,000 on popular models, Nomura Research said in a note Tuesday.

 

Yet, this wasn't the only reason why overall wholesale despatches fell in August. Muted demand for passenger vehicles mounted additional pressure on retail sales of the segment in August, as seen in the paltry 1% on-year rise in new vehicle registrations in August, same as in July, according to HSBC Global Research. On a monthly basis, passenger vehicle registrations fell 4%, compared to 9% growth in July and a fall of 3% in August last year.

 

Channel checks by YES Securities revealed that weak retail sales were seen in key states of western, central, and northern India. "While elevated discounts fail to lift demand sentiments, expectations of the GST cut in PVs (passenger vehicles) further dampened customers' buying decisions," the brokerage said in a report. According to media reports, the GST on smaller cars could be cut to 18% from 28%. On larger cars, it could be cut to 40% from the current 43-50%.

 

OUTLIERS

Among all four-wheeler makers, M&M reported the steepest year-on-year fall in despatches in August, down nearly 9% on year and 21% on month. "With the final GST announcement approaching, we consciously decided to bring down the wholesale billing to minimise the stock being carried by our dealers," said Nalinikanth Gollagunta, chief executive officer of the company's automotive division.

 

However, M&M's retail sales in India grew nearly 7% on year in August. The company's retail market share rose to 14.2% in the first five months of the financial year 2025-26 (Apr-Mar), against 11.3% a year ago, HSBC said. It was the only listed automobile company to register an increase in retail market share in this period.

 

Following is the wholesale sales data of Indian automobile companies' passenger vehicles in August:

 

Company	Aug-25	Jul-25	Aug-24	YoY %	MoM %
Maruti Suzuki	177,911	177,732	179,287	-0.77	0.10
M&M	39,399	49,871	43,277	-8.96	-21.00
Hyundai	60,501	60,073	63,175	-4.23	0.71
Toyota	29,302	29,159	28,589	2.49	0.49
Total	307,113	316,835	314,328	-2.30	-3.07

 

End

 

Reported by Anand JC

Edited by Rajeev Pai

 

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