Passenger vehicle (PV) retail sales witnessed a year-on-year (YoY) growth of 63% to 2,61,744 units in the month of July (2021) due to the lifting of lockdown curbs as well as a low base recovery, according to data shared by the Federation of Automobile Dealers Associations (FADA) on Monday.
Total vehicle retails at the regional transport offices (RTOs), which are proxies for sales, jumped by 34.12% to 15,56,777 units over July 2020 period.
When compared to July 2019 (a regular pre-covid month), vehicle sales are still down by 13%, as per the data.
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"On a YoY basis, all categories were in green with 2W up by 28 percent, 3W up by 83 percent, PV up by 63 percent, tractor up by 7 percent, and CV up by 166 percent. After tractors, PV for the first time showed strong numbers by clocking 24 percent growth when compared to the pre-covid month of July 2019," the dealers' lobby body noted.
"Semiconductor situation is becoming quite grave with supply-side constraints," it added.
FADA has been raising red flags about semi-conductor shortage for quite some time. The situation is now becoming grave with ever-increasing supply-side constraints.
The delta variant and a possibility of 3rd wave continue to remain a threat for stable auto retails, it noted.
Commenting on the July 2021 performance, FADA President, Vinkesh Gulati said, "With the entire country now open, July continues to see a robust recovery in Auto Retails as demand across all categories remain high. The low base effect also continues to play its part. With all categories in green, CV's continue to see an increase in demand especially in the M&HCV segment with the government rolling out infrastructure projects in many parts of the country. PVs witnesses high demand especially with the buzz around new launches and compact SUV segments."
"The 2W segment though continues to see positive demand YoY, the rate of recovery remains sluggish as customers at the bottom of the pyramid suffer with poor disposable income and rural markets where covid cases were high during the 2nd wave," he added.
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Regarding the near-term outlook, FADA noted that the month of August began on a positive note as demand and enquiry levels continue to improve across all categories.
"With IMD forecasting a normal monsoon during August- September period, sowing operations will pick up gradually. This will have a rub-off effect on rural sales especially in the tractor segment," it said.
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