Cars And Tractors See Uptick Even As Retail Auto Sales Contract For Second Straight Month

Passenger vehicles and tractors saw an uptick in sales at dealerships even as overall retail demand contracted for the second straight month in May despite curbs being eased in the third and fourth phases of the lockdown.

Vehicle registrations, a measure of sales at dealerships, fell 48.6% sequentially and 89.4% year-on-year to 1.93 lakh units in May, according to data from 1,225 regional transport offices in 32 states and union territories, collated by BloombergQuint from the website of the Ministry of Road Transport and Highways.

Most large automakers have also reported a sharp drop in factory-gate shipments for the second straight month even as India continues to resume economic activity in phases, while extending stay-at-home orders to contain the Covid-19 pandemic.

States including Gujarat, Haryana, Maharashtra and Tamil Nadu, where auto hubs are located, have extended lockdown till June end. And while manufacturing units are allowed to open, they continue to face manpower restrictions and are operating at reduced capacity. Automobile dealerships also remain closed largely, especially in urban areas. That suggests that auto sales, which were slowing even before the pandemic struck, may take months to return to pick up.

According to the Ministry of Roads, Transport and Highways, overall retail registrations for April and May stood at 3.77 lakh and 1.93 lakh units, respectively.

Two-Wheelers

Manufacturers began pushing scooters and motorcycles complying with the stricter Bharat Stage-VI standards in May, according to data on the ministry’s website. Two-wheeler retail sales declined sequentially.

Passenger Vehicles

Maruti Suzuki India Ltd., the nation’s biggest carmaker, saw higher retail sales in May after a washout in April. Most other makers of cars and utility vehicles also reported an increase. Still, the numbers were a fraction of the level seen a year earlier.