Auto retail sales grow 26% in November on festive, wedding push

Pic used for representation purpose (Image Credit: Pixabay)

After growing by over 50 percent in October 2022 on a year-on-year basis,  automobile retail sales increased by 26 percent with 23,80,465 vehicles going off showrooms in November, according to data shared by the Federation of Automobile Dealers Associations (FADA). Nearly 18,93,647 vehicles across segments were sold in the same month last year.

Two-wheelers, three-wheelers, passenger vehicles (PVs), tractors and commercial vehicles (CVs) saw a growth of 24 percent, 80 percent, 21 percent, 57 percent and 33 percent respectively, as per FADA.

The total two-wheelers sales were up by 23.61 percent at 1847,708 units as against 1494,797 units in the same month last year. The total number of PV retailed was also up by 21.31 percent at 300,922 units as against 248,052 sold in November 2021. CVs off-take also went up by 32.80 percent at 79,369 units as compared to 59,765 units sold in November, as per the data shown below.

FADA claims that the "baton was passed" by the positive run of festive sales to the ‘Great Indian Wedding Season (from 14th November to 14th December)’ where around 32 lakh weddings are being solemnised across the country.

FADA President, Manish Raj Singhania also revealed that November 2022 has clocked highest retails in the history of the Indian automobile industry with March 2020 being an exception when retail sales were higher due to BS-4 to BS-6 transition.

“The RBI’s latest Consumer Confidence Data suggests that buoyancy among customers is on a recovery path on account of better perceptions on the general economic situation, employment and household income. This along with the ongoing festive season has continued to help in bringing customers to the showrooms as on date,” Singhania said.

Pre-Covid comparison

Even when compared to November 2019, the pre-Covid month, overall retails for November 2022 closed in green by growing 1.5 percent. Except 2W, all the other categories -- 3W, PV, tractors and CV grew by 4 percent, 5 percent, 61 percent and 6 percent respectively, as per FADA.

“Better availability of model mixes from past months, new launches and increase in rural demand continues to keep the segment in healthy condition. In addition, compact SUV and SUV categories coupled with higher variant models continue to rule to roost,” noted Singhania.

FADA also revealed that 2W segment showed a huge growth of 24 percent YoY but fell marginally by 0.9 percent, when compared to November 19, a pre-Covid year. “This segment is slowly turning the tide from negative to positive as the same can be witnessed from retail sales due to the ongoing wedding season, further added Singhania.

On the growth in the CV segment, Singhania said, “With the government’s continued focus in the infrastructure space and new mining projects, replacement demand continued to pour in along with healthy inter-state passenger movement enabling bus sales.”

Inventory status

One of the key findings from FADA's online members’ survey during November was that the average inventory for PVs ranged from 35 to 40 days and the average inventory for two-wheelers was between 30 and 35 days.

Meanwhile, FADA hopes that the sales will remain on an upward trajectory in December too as most of the OEMs are announcing price hikes going forward. “To counter this and for the lower end of the pyramid, dealers have started announcing discounts for slow-moving products, lower variants and to clear their year-end stocks. This may help year-end sales to remain healthy,” added Singhania.

FADA expects auto sales to rise further once the harvest comes into the market and farmers start getting money in their hands.