Auto retail sales in June demonstrated a 10% YoY growth, encompassing positive performances across all vehicle categories including 2W, 3W, PV, Tractor and CV with respective growth rates of 7%, 75%, 5%, 41%, and 0.5%, according to the Federation of Automobile Dealers Association’s (FADA) vehicle retail data for the month released on Thursday.
Despite a slight decline of -3% compared to pre-COVID levels, the overall retail figures relatively improved, except 2W sales (-14%) being the primary segment which continued to experience setbacks. For the first time, CV came out of the effect of Covid and grew by 1.5% when compared to June 2019.
June 23 recorded multiple segment all-time highs as 3W, PV and Tractor showed maximum strength when compared to previous Junes.
The 2W sector wrestled with supply constraints from certain OEMs and a softer demand attributed to economic conditions and higher entry-level bike costs. New model introductions, festive promotions and seasonal factors couldn’t markedly boost sales. A 12% MoM drop was observed in two-wheeler sales, with electric vehicle sales witnessing a 56% MoM decline, primarily due to the government reducing FAME subsidies, triggering extreme price hikes.
June 23 witnessed the 3W market’s robust growth, primarily owing to the previous year’s low base effect and positive market sentiment. The shift towards alternative fuels, predominantly EVs, continues to play a significant role in driving this growth, despite potential supply concerns due to non-availability of OBD2 vehicles.
The PV segment navigated through a mixed landscape characterized by variable demand, dynamic product portfolios and oscillating market sentiments. With dealers noting sporadic supplies of popular models and aging product concerns of slow-moving variants, the segment still experienced an uptick in demand for new models and anticipates rural sales to pick up further pace.
The CV segment faced mixed dynamics influenced by inconsistent demand, supply issues, government policies and external market factors. Despite fluctuating demand and vehicle availability issues, the government’s infrastructural push and coal mining growth spurred demand for heavy commercial vehicles, counteracted by high-interest rates and rising prices.
Commenting on June 2023 performance, FADA President Mr. Manish Raj Singhania said, “Despite a 10% YoY growth, Auto Retail sector has seen an 8% MoM dip, indicating a short-term deceleration in sales. Analysing individual categories on a YoY basis, 2W, 3W, PV, Tractor and CV segments observed growth rates of 7%, 75%, 5%, 41% and 0.5% respectively. In comparison to pre-COVID levels, the overall auto retail marked a marginal decrease of 3%, with 2W as the sole laggard. Conversely, the CV segment experienced a 1.5% growth compared to June’19, surpassing the pre-COVID levels for the first time.
