March auto volumes | PVs slowing down, 2W steady with no improvement: Nomura

(Representational image; Photo by Taras Makarenko/Pexels)

Demand in consumption-driven auto categories seem to dull, going by March volume estimates from the brokerage Nomura.

Their dealer surveys showed that “passenger vehicle (PV) enquiries/ footfalls have slowed down sharply and waiting periods have reduced further. Except for few key models, most others have a waiting period only for select variants… suggesting slower demand outlook”. The brokerage, in its report on March volumes, estimated the month’s PV registrations to be 2,84,500 units, which would be a one per cent drop year-on-year (YoY). Last March, registrations for the segment totalled 2,86,100 units, which was a 4 per cent YoY growth.

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In two-wheelers (2Ws), “demand remained steady but without any sign of improvement”. The brokerage estimated 2W registrations to touch 12,89,500 units in March 2023, which would be a zero per cent increase YoY. The registrations count was 12,86,000 units last March, which was a 7 per cent YoY growth. Nomura also noted the drop in waiting period for Royal Enfield’s (RE) models and saw this as a weakness in demand.

In commercial vehicles (CVs), light commercial vehicles (LCVs) sales “seem to be subdued with no major pick up even for pre-buying of vehicles”, the report stated. LCVs are mostly used to transport consumer goods over short distances or for last-mile connectivity.

Also read: CV sales may zoom ahead as buyers try to avoid price hike from April 2023

The report noted that the demand for MHCVs was high and attributed it to a likely price hike (3-5%) and technology change after the implementation of Bharat Stage VI Phase-2 from April 1, 2023. It added, “We note that demand is strong in the infrastructure-related segments, but not equally strong in the haulage and auto carrier segments (shift to rail transport may also have impacted demand, in our view).”

The analysts estimate the MHCV segment to deliver 10 percent YoY growth in FY24, and Ashok Leyland and Tata Motors to deliver industry-beating 11 percent and 13 percent YoY growth that fiscal.