Representational photo
| Photo Credit: PTI
Auto retail sales in June 2023 reported a 10% y-o-y growth owing to positive performances across all vehicle categories including two wheelers, three wheelers, passenger vehicles (PVs), tractors, and commercial vehicles (CV) at growth rates of 7%, 75%, 5%, 41%, and 0.5% respectively, according to data released by the Federation of Automobile Dealers Associations (FADA).
Despite a slight decline of 3% compared with pre-COVID levels, the overall retail sales figures relatively improved, except two wheeler sales (-14%) being the primary segment that continued to experience setback. For the first time, CVs came out of the effect of COVID and grew 1.5% when compared with June 2019 sales, the dealers body said.
“Despite a 10% y-o-y growth, the auto retail sector has seen an 8% month-on-month (MoM) dip, indicating a short-term deceleration in sales,” said FADA president Raj Singhania.
“Despite some short-term contraction, India’s growth narrative remains resilient. The month of June ‘23 registered all-time highs for three wheelers, PVs and tractor segments when compared with all previous June months,” he said.
A 12% month-on-month decline was observed in two-wheeler sales, with electric vehicle sales witnessing a 56% m-o-m decline, primarily due to the government reducing FAME subsidies, triggering extreme price hikes, FADA said.
On the near-term outlook, FADA said that July 2023’s auto retail outlook signals mixed trends and the two wheeler market would continue to face supply challenges and economic pressures. The cutback in FAME subsidies casts a shadow on EV sales, while the three wheeler market would grow.
“The passenger vehicle segment faces a dichotomy of factors. While the launch of new models and potential rise in rural sales lend optimism, dealers navigate inventory pressures from OEMs and demand-supply mismatches, impacting profitability,” FADA said.
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