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Festive season fails to lure buyers to vehicle showrooms in August

Despite good monsoons and beginning of festive season the vehicle automobile market could not attract the anticipated buyers. The auto retails saw only 8% growth in August, the Federation of Automobile Dealers Associations (FADA) said in a statement.

“Auto Retail for the month of August saw an overall growth of 8%. August opens the door for festival season to kick in. While Dealers anticipated good Ganesh Chaturthi in August, the results thus far has not been encouraging. In spite of good monsoons, festive season began with a dampener during Ganpati,” said FADA President Manish Raj Singhania.

Total vehicle retails also dropped by 7% year-on-year (YoY) last month. While passenger vehicles’ sale outperformed handsomely by growing 41%, consumer vehicles’ also turned positive by growing 6% and thus came out of the Covid blues. All the other segments were in red with 2W, 3W and Tractors falling by -16%, -1% and -7% respectively.

While the 2W segment has grown by 8.5% YoY, it continues to face covid blues due to underperformance of Bharat and is still not above 2019 levels. This coupled with price hikes has made the 2W product out of reach for most entry level customers. With erratic monsoon, the crop realisation has been low and flood like situation has restricted customer movement.

The 3W space continues its healthy double digit growth (grows 83% YoY) when compared YoY. It has now also equalled 2019 sales for the first time. Electrification is also the highest in this category as e-Rickshaw leading the way. There is a clear indication that customers are now preferring electric vehicles over ICE vehicles as ICE 3W continues to see double digit de-growth when compared to pre-covid levels.

The CV segment continues to witness an upswing in economic activities post monsoon and saw a growth of 24% YoY. This along with government’s infrastructure push, new launches by OEMs and better conversion in fleet operations has kept the segment in green. Apart from this, the Passenger Carrier segment is also showing good demand due to increased buying from Educational Institutions.

The PV segment continues to be on a bull run (grows 6.5% YoY) as demand for all sub categories of vehicles except entry level remained strong. This is also aided by new feature rich launches which OEMs are doing since last few months. With semi-conductor shortage slowly becoming a passe, vehicle availability has definitely improved but waiting period continues to remain due to high demand in higher feature rich variants.”

 

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