Passenger vehicle sales fall 4% in Jan
NEW DELHI: Retail sales of passenger vehicles fell 4.46% to 281,666 units in January from the year ago period after growing for two months in a row, showed data released by the Federation of Automobile Dealers Associations (Fada) on Tuesday.
The decline in sales was primarily because of a high base in January 2020, when automakers increased discounts to liquidate stocks of BS-IV vehicles before transitioning to the new emission regime. Price hikes by automakers were another factor.
Showroom sales, though, increased on a month-on-month basis from 271,249 units in December, when automakers and dealers offered more discounts to reduce inventory before the end of the calendar year. The data also indicates better-than-expected recovery in retail sales on a sequential basis because of increased demand in rural and semi-urban markets, recovery in metro cities, and a shift in customer preference towards personal transport amid the Covid-19 pandemic.
The retail sales data for the month stood at variance with the wholesales dispatch data released by automakers. Wholesales of Maruti Suzuki India Ltd, India’s largest carmaker, decreased by 0.2% (increase of 2.6% including vehicles sold to Toyota), while that of Hyundai Motor India Ltd jumped by 23.8% to 52,005 units. Tata Motors reported a 94% jump in dispatches to 26,978 units. The anomaly could be attributed to carmakers increasing wholesales to build inventory at dealerships after seeing a sharp recovery in retail sales during the October to December period, which left dealer stocks depleted.
Showroom sales of motorcycles and scooters fell 8.78% to just over 1.1 million units, because of a softening of demand for entry-level motorcycles in rural areas and resumption of public transport everywhere. Retail sales also declined. Two-wheeler manufacturers resorted to significant reduction in production as demand contracted after the festive season. The covid-19 pandemic and revised freight loading norms meant retails of commercial vehicles also declined 25% to just 55,835 units January compared to last year.
Bookings and enquiries for passenger vehicles continued to improve during January, while demand for new sport utility vehicles helped restrict the fall in registrations during the month, according to Vinkesh Gulati, president, Fada.
“The recent price hike by automakers also added to woes as two-wheelers have become expensive for the lower and middle income classes,” Gulati said.