Tata Motors to declare quarterly auto sales numbers, others may follow suit

The company has gone on to say in a communication that this decision would help the dealers focus on serving customers and help their investors to focus on the long term drivers of the business and avoid needless short term volatility.

Tata Motors today announced that it would declare its auto sales numbers once every quarter instead of monthly sales numbers. This was to take the right long-term decisions for the business, confirmed a spokesperson for the company. Other companies, especially those which are listed may follow suit in due course.

It is also significant that Tata Motors has mentioned that it would be reporting quarterly numbers both in wholesale and retail. The company has gone on to say in a communication that this decision would help the dealers focus on serving customers and help their investors to focus on the long term drivers of the business and avoid needless short term volatility.

This decision has once again opened up the long standing debate on the auto industry being divided down the middle on the wholesale versus retail sales numbers declaration. Adding to this cauldron is the fact that auto industry’s apex body, SIAM is yet to take a firm stand on this issue.

What is interesting is the fact that auto companies have been quietly advocating the declaration of retail sales numbers which mostly are positively dispensed. The country’s largest car maker, Maruti Suzuki is the only exception to not join the retail bandwagon. However,each company who advocated retail sales, refused to divulge their specific retail numbers.

Unlike the global norm, Indian vehicle manufacturers only report their wholesale figures, which represent dispatches from manufacturing plants to dealers. Retail sales figures reflect actual purchases by end consumers and there can often be a mismatch in wholesale and retail figures with the former not being a true representation of consumer sentiments is what companies feel.

Experts feel that the primary reason why companies are clamoring for retail numbers is with the current auto industry slowdown, retail numbers better justify actual sale of cars to customers at the dealerships as a yardstick of consumer sentiment. Sceptics though are quick to point out that this issue never raised its head during happier times of a growth led auto industry.

Avik Chattopadhyay, independent auto consultant mentioned, “What matters is the final sale to the consumer, yet OEMs fuss only about the vehicles leaving their excise gates. Manufacturers should realise that they are all in it together with the dealers till the vehicle finally is being delivered. It is time that FADA & SIAM actually got together for sales and inventory management."

FADA, the apex body for auto dealers has urged SIAM to publish market share calculations based on vehicle registration data which is found in Ministry of Road Transport & Highway’s Vaahan platform. Vehicle registration data is representative of retail sales and thus reflects market sentiment much quicker than wholesale numbers, they opined. However no decision has been reached as yet on this matter.

Interestingly Rajan Wadhera, current SIAM President had dismissed FADA's data during SIAM’s quarterly media briefing in October last year. He refused to go on record on whether reporting retail sales made more sense than wholesale numbers, adding to the prevailing confusion.

Clearly the last word has not been said on this debate but what is certain is that this issue adds one more controversy within India's automotive industry which is already a divided house.