Auto Sector Check - Sustained Demand Momentum In PVs, CVs; Two-Wheeler Recovery Remains Weak: Motilal Oswal
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Motilal Oswal Report
Passenger vehicle and commercial vehicle demand continues to remain on a recovery path, while two-wheeler demand stays weak. Tractor demand is also weak in a seasonally weak period.
Our interaction with leading industry channel partners reflects pessimism for two-wheelers. Passenger vehicle dealers reflect optimism on strong demand and improving supply from original equipment manufacturers. Medium and heavy commercial vehicles demand is benefiting from the rise in the construction activity.
Fear of the new Covid-19 variant (Omicron) has affected buying sentiment, mainly in the two-wheeler segment.
In December 2021, wholesale volumes are estimated to decline by 12% YoY for two-wheelers and tractors. Passenger vehicle volumes are estimated to grow by 7% YoY as semiconductor availability slowly improves.
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