No Festive Boost Yet For Retail Auto Sales
Automakers pushed inventories to dealerships ahead of the festive season in October anticipating a pick-up in sales but data from the ground isn’t encouraging.
Factory-gate shipments of cars, two-wheelers, commercial vehicles and tractors were significantly higher than retail sales in the last two months, leading to a build-up in inventory levels which has crossed the 30-day mark.
Vehicles registered during the nine-day Navaratri festival remained 11.5% lower than last year, according to data from the Ministry of Road Transport and Highways.
Retail auto sales in the festive month of Dasara rose 4.1% sequentially to 14.06 lakh units but is 24.1% below levels seen in October 2019, according to data compiled by BloombergQuint from the website of the Ministry of Road Transport and Highways.
Auto registrations continue to rise on a month-on-month basis even as the government is opening up the economy in a phased manner. But sales are yet to reach pre-Covid levels or those seen during the same period a year ago.
Two-wheeler makers pushed high inventory at dealerships, but demand hasn’t met expectations. Registrations of the top two-wheeler makers tracked by BloombergQuint saw its retail registrations jump by 1.4% month-on-month in October while it was down 28.5 percent over same period last year.
Passenger carmaker was the only category to post growth in registrations during the nine-day Navaratri festival compared to last year. While demand grew nearly 25.4% sequentially, it remained subdued on a year-on-year basis. Retail registrations were down 12.8% in October compared to the same period a year ago.
Commercial vehicle registrations have picked up along with rise in economic activity. Sales of buses remain muted as demand from schools is yet to revive. On a month-on-month basis, registrations rose 19.7% but were down 40.8% compared to the year-ago period.
Tractor sales showed signs of slowing demand as the monsoon draws to a close. Sales fell 20% month-on-month but was up 52.7% year-on-year.