Sales of passenger vehicles rose 19% year-on-year in September to 3.32 lakh units in September 2023, according to data released by the Federation of Automobile Dealers Associations (FADA). PV sales in August stood at 3.15 lakh units.
The passenger vehicle category experienced a stimulating resurgence as the market enjoyed improved vehicle availability and an influx of new and refreshed models from various OEMs (original equipment manufacturers), the dealers' lobby says.
The auto market showed consistent demand for luxury cars and SUVs, signifying a robust consumer appetite for premium segments, says the FADA. The segment also witnessed the benefit of good pending bookings and the launch of promising products, laying the groundwork for potential growth in the upcoming festive season.
This upturn in auto sales was supported by enhanced supplies and an increasing variety in the product portfolio, answering to diversifying consumer demand.
FADA, however, warns with inventory for passenger vehicles reaching an unprecedented 60-65 days threshold, it's crucial for OEMs to proceed with caution, avoiding excessive inventory pushes, thereby ensuring a market that's both vibrant and stable during the festive spree.
"The favourable monsoon patterns, with India receiving 94% of expected rainfall, set a positive backdrop for the festive season. As we move past the Shraadh period on October 14, the market is poised for the onset of Navratri, heralding a 42-day festive window," FADA says, adding it is optimistic and anticipating a thriving festive season for the Indian auto retail sector.
The overall auto sales, too, witnessed a double-digit growth of 20%. "September's Auto Retail celebrated a 20% YoY leap, continuing the momentum from the previous month while marking a 3.5% MoM increase, seamlessly transitioning into the festive period's sweet spot set to unfold over the next 42 days," says FADA president Manish Raj Singhania.
The year-on-year analysis reveals broad-based growth across segments as two-wheelers posted a 22% increase in sales, three-wheelers soared 49% and commercial vehicles jumped 5%. However, tractors diverged with a 10% decline.
In comparison to pre-COVID-19 years, the auto sector sales grew by a robust 14%, with the 2W category registering growth of 2% for the first time.
"The 2W segment witnessed positive shifts as the festive season approaches. With the introduction of new models and attractive promotional offers, demand increased, especially in rural areas, fostering improved market sentiments," says Singhania.
This uptick in demand was accompanied by heightened customer walk-ins and an overall positive market response. Singhania adds that better stock availability than the previous year and a favourable reception to newly launched entry-level products have set an optimistic tone for the upcoming festive season.
Three-wheeler sales notched another all-time high in September, recording 1,02,426 units. This represents a 49% YoY and a 3% month-on-month growth, surpassing the previous record of 99,907 units set in August 2023.
As the festive season unfolds, a wave of anticipation and enthusiasm is expected to sweep across the automotive sector, according to FADA. "In the 2W segment, although the initial half of the month might be quiet due to the Shraddh period, the aura of upcoming festivals like Durga Puja and Navratri is predicted to brighten the sales atmosphere, with enhanced customer sentiment and competitive pricing playing pivotal roles. The introduction of new models will further add to the optimism," the dealers' lobby says.