Source: The Economic Times, Sept 09, 2020
The retail of automobiles continued to recover in August and the deficit with last year’s sales levels came down significantly as demand improved during festivals like Ganesh Chaturthi and Onam, showed vehicle registration data.
Vehicle registrations in the country increased by 4% in August over July. While the registrations were 27% less when compared to August 2019, it was an improvement over July, when sales were down 36%.
“With the start of the festival season and the government’s continued effort to open up India, the month of August saw good numbers when compared to previous months,” said Vinkesh Gulati, president of the Federation of Automobile Dealers’ Associations (FADA), a lobby of vehicle retailers.
“Apart from the rural market which was showing revival signs until now, urban centres for the first time showed initial signs of demand pullback,” he said.
The sharpest recovery was for the passenger vehicles segment with sales of about 178,500 units – just 7% fewer than August 2019. Two-wheeler sales were down 29% compared to the previous year, while three-wheeler and commercial vehicle sales declined 70% and 58%, respectively.
Tractors sales continued to be higher than the previous year for the third straight month due to good monsoon rains and better rural sentiment. The data were compiled by FADA from road transport and highways ministry’s VAHAN platform. The website captures vehicle registrations from 1,242 out of 1,450 regional transport offices in the country as some states are yet to migrate on to the platform.
The recovery may break momentum in September, cautioned Gulati, due to the Shraadh period this month which is considered inauspicious by some communities. During this period retailers would be focussing on following up on customer leads and generating an order book for October and November in anticipation of festivals like Navratri and Diwali.
Automobile manufacturers are planning record production for the months of September-November as they anticipate substantial demand recovery during these months, ET reported earlier this month.