Auto firms likely to have negative news on Dec sales on New Year’s Day
Seasonality, year-end shutdowns and inventory management in the runup to BS-VI transition will likely result in another tepid month for auto companies when they report their monthly sales numbers for December on January 1, 2020. The numbers are likely to suggest that the slowdown that has engulfed the sector for almost a year now is not over yet, analysts said. On a year-on-year basis, the picture isn’t good. Passenger vehicle (PV) sales are likely to be tepid. While Nomura estimates a marginal 2 per cent year-on-year increase in PV sales, Prabhudas Lilladher has projected a 5-6 per cent drop. Two-wheeler (2W) sales may decline 2 per cent. However, the fall in sales of commercial vehicles is projected to be the higher at 30 per cent. “With the impending price hikes of 13-15 per cent for BS-VI models coming in from April, 2020, demand headwinds should continue in FY21F for the two-wheeler segment,” Nomura said in a report. Brokerage Prabhudas Lilladher sees some pre-buy