Auto retail sales grew by strong double digits last month, signaling a rebound in demand in sectors hit by the pandemic over the past two years.
According to the Federation of Automobile Dealers Associations (FADA), 1,550,855 vehicles were sold in June, up 27% from 1,219,657 units sold a year ago. However, sales were down around 9% compared to pre-Covid June 2019.
The association has compiled the figures from vehicle registration data available on the Department for Road Transport and Motorways’ vehicle dashboard.
Although the figures are incomplete, as some regional transport companies are still not connected to the vehicle portal, they are considered a good indicator of the development in car retailing, as manufacturers only disclose their shipments from the factories. ET office
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Excluding passenger cars and tractors, which have already been above pre-Covid levels in recent months and grew 27% and 40% respectively in June three years ago, commercial vehicle sales surpassed pre-Covid numbers for the first time. A 4% expansion compared to June 2019. FADA President Vinkesh Gulati said this indicates a “gradual recovery for this segment (CVs)”.
Gulati said that while three-wheeler sales fell more slowly by 6% compared to June 2019, it was the two-wheeler segment that was still the biggest concern and not growing as expected. Two-wheeler retail sales rose by a fifth year-on-year to 1,119,096 units in June, but fell 16% in 2019 compared to the same month before Covid.
“Two-wheeler sales remained low due to poor market sentiment, particularly in rural India, high running costs, inflationary pressures and June being a generally weak month due to rainfall,” he said.
The average inventory of two-wheelers is now 20-23 days.
Despite strong demand in the passenger car segment, Gulati warned of inflationary risks due to the Russian-Ukrainian war. The Reserve Bank of India has also said that high inflation is a major concern and has raised interest rates. In recent months, the prices of almost all essential items have risen, which weighs on household budgets and reduces disposable income for buying passenger cars.
“Moreover, high fuel prices have had a spillover effect on transport, making it more expensive. This will negatively impact entry-level passenger cars and two-wheelers, which tend to be dominated by first-time buyers. are.” Gulati
The average inventory of passenger cars is 15-20 days versus the current norm of 30-45 days. While semiconductor availability has improved, reflected in volume production, wait times remain high, particularly in the compact SUV and SUV segments. FADA said the newly launched vehicles are seeing strong bookings, indicating healthy demand.
As rural India stabilizes, auto trade is expected to pick up in the coming holiday season.