New Delhi
An extended festive season leading into weddings has led to a surge in automobile retail sales in November 2023, of 28.54 lakh vehicles, led by 2wheelers and passenger vehicles which created new records. The 2W category saw sales of 22.47 lakh vehicles, an increase of 1.77 lakh vehicles compared to the previous high of March’20. The PV category also sold 3.6 lakh vehicles, 4000 vehicles more when compared to the previous highs of October’22, according to data released by the Federation of Automotive Dealers’ Association data for November.
Manish Raj Singhania FADA President sees November’23 as a historic month for the Indian auto retail industry with total sales overtaking the previous highs of March’20 when the industry sold 25.69 lakh vehicles during the BS-4 to BS-6 transition. While showrooms dispatched 22.47 lakh 2Ws, exceeding March’20’s 20.7 lakh vehicles, PV sales reached 3.6 lakh vehicles, surpassing Oct’22 sales of 3.57 lakh vehicles,
For November’23, total retail sales grew by 18 per cent yoy, with 2Ws growing by 21 per cent, 3W growing by 23 per cent, PV categories by 17 per cent, while tractor witnessed a drop of 21 per cent and commercial vehicles by 2 per cent. The 2W category, which rose to glory during the festivities, grew by 49 per cent on a month-on-month basis, aided by PVs which grew by 2 per cent, thus leading the entire industry to a growth of 35 per cent MoM.
The marriage season is boosting vehicle sales as India is witnessing approximately 38 lakh marriages between 23 November and 15 December, a period that typically sees high vehicle sales, especially in rural India. For the 2W category, the month witnessed a significant boost in auto retail, thus making it clock all-time high retails, buoyed by the festive excitement of Deepawali and enhanced by strong rural sentiments, thanks to thriving agricultural income. New product launches and better model supply further fuelled the market’s growth, while EV sales demonstrated an encouraging upward trajectory. For instance, Wardwizard Innovations & Mobility, the manufacturer of “Joy e-bike,” sold 2,563 units of electric two-wheelers, including both low-speed and high-speed models, and marked the inauguration of over 100 exclusive distributor showrooms nationwide.
November 2023 witnessed a strong surge in the PV category, primarily fuelled by Deepawali and the launch of new and appealing models. The improved supply chains, coupled with new launches, effectively catered to the festive demand, marking the peak point in sales. However, the period following the festivities saw a noticeable slowdown, coupled with a critical challenge of slow-moving inventory due to a mismatch in demand and supply which is still not resolved.
The PV inventory has slightly reduced but continues to remain above 60 days, driving FADA to urge PV OEMs to cut back on dispatches of slow-moving vehicles in the entry-level category and to announce extremely attractive schemes that will support year-end buying and help reduce inventory at dealerships.
The CV category saw a challenging Nov’23, driven by poor market sentiment, seasonal slumps, exacerbated by unseasonal rains damaging crops and impacting transport demand, coupled with liquidity issues and delayed deliveries. States going into elections also added to the woes, overshadowing the brief uplift from festive sales and the slight increase in tourism that helped in sales of buses.In the near term, FADA sees the 2W category poised to benefit from a liquidity boost, particularly in agricultural regions and the ongoing marriage season, with around 38 lakh marriages expected to drive vehicle sales. However, challenges persist as severe weather conditions impacting rabi cultivation might affect rural incomes, potentially dampening sales.