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Demonetisation Affects Maruti December Sales

By   |   02 January,2017

Maruti Suzuki India Limited, the largest seller of passenger vehicles in the Indian car market, sold a total of 117,908 units in December 2016. This includes 106,414 units in domestic market and 11,494 units of exports. The Company had sold a total of 119,149 units in December 2015.

The Indian car maker sold 81,092 passenger cars in December 2016 compared to 91,043 units in December 2015, which is a decline of 10.9%. However, thanks to new launches this year such as the successful Vitara Brezza compact SUV, the decline was prevented from being even worse. On the other hand, exports of the company jumped drastically from 7,816 units in December 2015 by 47% to 11,494 units in December last year. This helped bring down the overall decline in sales of Maruti Suzuki from 4.4% (considering only domestic sales), to 1%.

The utility vehicle segment of Maruti Suzuki, comprising of the Gypsy, Ertiga, S-Cross and the Vitara Brezza, did especially well thanks to the introduction of new vehicles. While Maruti sold 9,168 vehicles from this segment in December 2015, they managed to sell 16,072 units in December 2016, which is an increase of 75.3%. The reason for this overall drop in sales can be attributed to the demonetisation drive that wiped out the worth of old 500 and 1000 rupee notes. A vast chunk of sales transactions in the automotive sector are dealt through cash and demonetising it put a halt to that. However, we feel that this sector will return to normalcy in the very near future.

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