By Varun Singh: The festive period turned out to be a bumper one as the overall auto retail in October crossed the pre-Covid mark with the passenger vehicle (PV) segment continuing its robust run and the two-wheeler segment making a strong comeback.
At 20,94,378 units in October, the overall auto retail logged in a rise of 47.62% over the same month last year and 8.32% over the same month in 2019, according to data released by the industry body Federation of Automobile Dealers Associations (FADA) on Monday.
With robust demand, especially in the SUV segment, the PV retail jumped 40.55% year-on-year (y-o-y) to 3,28,645 units in October. Also, the sales were 17.85% higher in comparison to October 2019. Amid an improvement in semiconductor supply, PV production has increased, leading to more despatches to the dealerships.
The two-wheeler segment clocked a rise of 51.10% y-o-y in sales to 15,71,165 units as the customer purchases were pushed by Navaratri and Diwali festivals. Surprisingly, the sales were 5.79% better than those seen in October 2019.
The average inventory for PVs was in the range of 35-40 days at the end of October, while it was 40-45 days for the two-wheelers.
"The PV segment continues to see extremely high demand, especially in SUV and compact SUV segments, including higher variants in most of the product categories. With better vehicle availability and new launches, the segment also witnessed the best festive period in a decade by surpassing 2020 festival sales by 2%," said Manish Raj Singhania, president, FADA.
Singhania said that the two-wheeler segment showed considerable growth in October and even rose above the pre-Covid period for the first time. "With both Navaratri and Diwali majorly falling in a single month, October saw double footfall at dealerships. Dealers say that sentiments have also started improving at the rural level but the same needs to sustain for at least the next 3-4 months. Apart from this, new launches and good customer schemes also played a pivotal role in reviving the demand," he observed.
The three-wheeler segment rose 65.87% y-o-y in October. However, there was a slight dip of 0.59% in comparison to October 2019. The commercial vehicle (CV) segment climbed 25.40% y-o-y and 12.88% over October 2019. The tractor segment registered a handsome growth of 17.42% y-o-y and 47.14% over the same month in 2019.
"The sub-category figures (in the three-wheeler segment) clearly show that a shift is happening towards EV adoption while ICE vehicles are no more favourites. In few pockets due to permit issues, new vehicle sales have taken a hit during the month," Singhania said.
On the CV retail, he said that festivities ignited better fleet sales. "With mining and infrastructure projects increasing in various regions, demand has been keeping well and is also coming back on track," he added.
VEHICLE RETAIL DATA
E-RICKSHAW WITH CART (G)
THREE WHEELER (GOODS)
THREE WHEELER (PASSENGER)
THREE WHEELER (PERSONAL)
Following the end of the festive period, November could see some softness in sales. According to FADA, the sentiment continues to show some headwinds, especially in the two-wheeler segment in rural areas, and for auto retail to show strength, the two-wheeler segment will have to grow for at least 3-4 months over pre-Covid months to come out of the woods.
The industry body said that most of the original equipment manufacturers (OEMs) will now start migrating towards manufacturing vehicles that will adhere to OBD-2 norms. "This will definitely see a steep price increase across all categories of vehicles as and when they hit the market. Also, with year-end coming close, many customers wait for vehicles manufactured in the new year," FADA said.