Auto retail sales rise 14.5% YoY to 13.84 lakh units in August: FADA

Two-wheeler in August rose 6.6 percent to 9,76,051 units from 9,15,126 lakh units, while passenger vehicle (PV) sales increased 38.71 percent to 2,53,363 units from 1,82,651 units, YoY.

“Auto Dealers are facing the most challenging phase of their business career as Covid-19 after-effect continues to play spoil-sport. While until last year, when demand was a challenge, supply is becoming a bigger problem currently due to shortage of semi-conductors, even though there is high demand for passenger vehicles,” said Vinkesh Gulati, President, FADA.

The Commercial Vehicle (CV) segment witnessed a jump of 97.94 percent at 53,150 units as compared to 26,851 units sold in the same month last year. Tractor sales for the month were up 5.5 percent at 71,737 units versus 67,999 units, YoY.

“With OEMs drastically cutting down productions due to unavailability of semi-conductors & ABS chips, shortage of containers and high metal prices, customers for the first time may not get a vehicle of their choice and lucrative schemes during this festive season. Ultra-frequent price increase is also keeping entry-level buyers at bay,” the industry body said in a release.

Further, customers especially at the bottom of the pyramid are shifting their priority to saving instead of spending. This will hence keep demand for 2-wheelers a concern, it added.

Though, with educational institutions slowly opening up, a ray of hope can be seen for an improved demand in the two-wheeler category in the coming months.

FADA thus sees that the near term outlook will continue to remain a mixed bag with PVs witnessing demand-supply mismatch and 2W facing a demand crunch.

Meanwhile, July 2021 inventory for passenger vehicles ranged from 25-30 days while for two-wheelers ranged from 20-25 days.