Automakers hit speed bump as passenger, commercial vehicle sales fall in November

The two-wheeler, three-wheeler and tractors segments posted y-o-y growth in sales in the reported month

Passenger and commercial vehicle sales took a knock in November, with cars hit the hardest, despite the festival season. Rural demand, however, gave a boost to two-wheelers and tractor sales.

Passenger vehicles (PV) sales were down 13.72 percent from the year-ago period and commercial vehicles 6.08 percent, the Federation of the Automobile Dealers Association (FADA) said on December 9.

The monthly performance, too, was poor for the both the segments, as PV and CV contracted by 33.37 percent and 15.85 percent, FADA said.

The automobile dealers body said Diwali, when a lot of consumers go for big-ticket purchases including vehicles, in early November provided some boost to the sales but wasn’t enough to offset the weak marriage season demand

It wasn’t all bad for the vehicle-makers. Two-wheeler, three-wheeler and tractors sales were up in November from the year-ago period.

“While November was initially expected to build on its prior momentum, particularly due to the marriage season, dealer feedback suggests that this segment underperformed overall expectations. Although rural markets offered some support, primarily in the two-wheeler category, marriage-related sales remained subdued. The late occurrence of Deepawali at the end of October also caused a spill over of festive registrations into November, affecting the month’s sales trajectory,” the statement said.

Two-wheeler sales grew close to 16 percent, while the three-wheeler segment saw a growth of 4.23 percent. Tractors zoomed 29.88 percent growth.

The two-wheeler segment also saw a 26.67 percent growth over October, FADA said.

Auto stocks were down up to 1.2 percent in the morning trade, with leading vehicle manufacturers such as Hyundai Motor and Tata Motors witnessing significant losses. The NIFTY Auto index slipped 0.44 percent, reflecting subdued market sentiment.

Hyundai Motor was down 1.2 percent at Rs 1,838, emerging as the top loser among auto majors, while Tata Motors declined 0.7 percent to Rs 811. Maruti Suzuki and Mahindra & Mahindra (M&M) also recorded losses, down 0.4 percent and 0.3 percent, amid concerns over weak passenger vehicle sales and high inventory levels.