December PV sales record 2.65% YoY growth, up 10.61% for CY23: FADA

During last month, the Passenger Vehicle (PV) wholesales were up by 4.4 percent to 2,87,904 units from 2,75,653 units in December.

Indian passenger vehicle (PV) manufacturers witnessed a 2.65 percent year-on-year (YoY) growth in sales in December 2023, according to the Federation of Automobile Dealers Associations (FADA). A total of 2,93,005 passenger vehicles (PVs) were sold in the domestic market last month compared to 2,85,429 units sold in December 2022.

The increase is attributed to the growing demand for SUVs, the consistent demand for PVs, a rise in production levels and strong economic growth.

Commenting on the sales trends in the PV segment, FADA President Manish Raj Singhania noted that the demand for SUVs was strong with extended waiting periods for key models. He added that the surge in SUV sales was triggered by year-end promotions and the introduction of new models.

“The surge (in SUV sales) was fuelled by aggressive year-end promotions and the introduction of new models. However, a significant concern was the high inventory levels, reflecting over-supply. This ongoing issue of high PV inventory, despite a slight decrease by the year's end, remains a critical area for OEMs to address, emphasizing the need for further moderation in inventory management,” said Singhania.

During last month, passenger vehicle (PV) sales were up by 4.4 percent YoY at 2,87,904 units from 2,75,653 units in December 2022. During the calender year of 2023, the total number of PVs sold was 41,08,000 units, up 8.3 percent from 37,92,000 units in 2022. Industry observers reckon that for the first time, the domestic PV market crossed the 40 lakh sales mark in a calendar year.

While giving the near-term outlook, Singhania maintained that the focus will be on clearing pending bookings and launching new 2024 models.

“Despite concerns over high inventory levels and the impact of year-end discounts, positive market sentiments and the introduction of new models are likely to drive growth. However, challenges remain in terms of supply constraints for higher variants and shifting consumer demands towards SUVs,” Singhania noted.

The overall domestic automobile retail sales went up by 11.05 percent at 2,38,67,990 units last year compared to 2,14,92,324 units in 2022, as per the auto retail body. Similarly, two-wheeler retail sales grew 9.45 percent last year to 1,70,61,112 units from 1,55,88,352 units in 2022.

Moreover, three-wheeler retail sales jumped 58.50 percent to 10,80,653 units last year from 6,81,812 units in 2022. Commercial vehicle (CV) retails saw an increase of 8.28 percent at 9,94,330 units from 9,18,284 units in 2022. Tractor retail sales rose to 8,71,627 units, registering a jump of 7.09 percent from 8,13,923 units sold in the preceding year.

In December 2023, the overall domestic automobile retail sales also increased by 21.14 percent to 19,90,915 units compared to 16,43,514 units in December 2022, as per FADA data. Two-wheeler sales rose by 27.56 percent to 14,49,693 units in December 2023 compared to 11,36,465 units sold in the year-ago period.

FADA noted that each sector within the auto retail industry is positioned for growth this year, navigating through the dynamic market conditions.