Festival demand helped spur domestic retail auto sales growth to almost 48% marking 20.94 lakh units in October compared with a year earlier, data from FADA showed. This year’s festival season proved to be the best in the last four years for the industry, the Federation of Automobile Dealers Associations (FADA) said on Monday.
Retail sales stood at 14.18 lakh units in October 2021. Sales showed an 8% expansion when compared with the pre-COVID month of October 2019. Passenger vehicle retails grew 41% to 3,28,645 units last month, while two-wheeler registrations rose 51% to 15,71,165 units. Commercial vehicle (CV) retail sales were up 25% to 74,443 units and three-wheeler sales climbed 66% to 66,763 units. Tractor retails recorded a 17% increase to 53,362 units.
“With most of the month [coming] under the festival period, the sentiments were extremely positive across all categories of dealership,” FADA President Manish Raj Singhania said in a statement. “Even when compared to pre-covid month of 2019, overall retail sales for the first time closed in green,” he added.
The robust demand due to festivities last month brought cheer to the industry as customers in every segment came out in good numbers making it the best in the last four years, he added.
“As anticipated earlier, the PV segment saw the best year in a decade by outgrowing 2020 numbers by 2%. When compared to pre-COVID festive season of 2019, overall retails were up by 6%,” Mr. Singhania said.
On the near-term outlook, he said, “With festivities ending, the immediate next month generally witnesses a certain amount of softness in sales. While farmers will start receiving their crop realisations, the overall sentiment continues to show some headwinds especially in the two wheeler rural segment,” he said.
The CV segment is expected to see continued demand due to an increase in the number of infrastructure projects and in government spending, he added.
While the PV segment continued to outperform, demand in the entry-level segment continues to show some softness, Mr. Singhania noted.
“Most of the OEMs will now start migrating towards manufacturing vehicles conforming to next [set of] emission levels. This will definitely see a steep price increase across all categories of vehicles as and when they hit the market,” he added.
Hence, he pointed out, FADA remains cautious as the auto industry approaches the year end.
