PV retail sales in March decline by 6% YoY, but rise 8.45% in FY24: FADA

Representation image (Credit: Pixabay)

Passenger Vehicle (PV) retail sales in March witnessed a decline of six percent Year-on-Year (YoY) at 3,22,345 units, as per data shared by  Federation Of Automobile Dealers Associations (FADA) on April 8. The decline comes after a sustained increase in sales, on an annual basis, over the last few months.

As per the auto retail body, the total PV retails during March last year were 3,43,527 units.

FADA claimed that the numbers went down YoY in March because, unlike last year, people postponed purchases to auspicious days of Navratra in April.

Manish Raj Singhania, President of FADA, believes there is no drastic fall in volumes because last year Navratra happened in the month of March and this year it will be in April. In his view, people postpone purchases to buy during the auspicious days such as Navratra, Gudi Padwa, and Eid which are starting from tomorrow (on March 9).

"People want to postpone their purchases as they wait to buy during mahurat days. If you combine March and April (auto retail) figures, we will have a decent growth,” noted Singhania.

FADA claimed that the downturn in March was influenced by “heavy discounting” and “selective financing”, and further affected by “economic worries” and the “electoral climate”.

“Nonetheless, positives such as improved vehicle availability, increased stock levels and new model launches did stimulate demand in certain areas. The impact of election activities and changes in festival dates also played a role in sales dynamics," said Singhania.

During the entire financial year of FY24, PV retails went up by 8.45 percent at 39,48,143 units vis-a-vis 36,40,399 units in FY23.

According to Singhania, factors such as “improved vehicle availability”, a “compelling model mix” and the “launch of new models” played pivotal roles.

"Enhanced supply dynamics, strategic marketing efforts, ever expanding quality road infrastructure and strong demand in the SUV segment, now holding a 50 percent market share, significantly contributed to this success,” added Singhania.

It was reported recently that PV wholesales  went up by 10 percent to 370,381 units in March 2024. For the fiscal year 2023-24, the total dispatches by carmakers to dealerships stood at 42,29,566 units, an 8.7 percent increase from 38,90,114 cars sold in FY23, as per industry data.

Double-digit growth in auto retails

Thanks to record offtake of passenger vehicles, three-wheelers and tractors, automobile retail sales in India saw double-digit growth in 2023-24. The retail sales across segments rose by 10 percent to 2,45,30,334 units last fiscal as compared with 2,22,41,361 units in 2022-23.

FADA president stated that the Indian auto retail sector achieved a commendable double-digit growth of 10 percent YoY across all categories, with 2W, 3W, PV, tractor and CV registering increases of 9 percent, 49 percent, 8.45 percent, 8 percent and 5  percent respectively.

“Notably, the 3W, PV and Trac segments set new record highs, surpassing previous years' performances. In FY24, the 2W segment saw a 9 percent growth, driven by a rich mix of factors including enhanced model availability, new product introductions, and positive market sentiment, further augmented by special schemes and the rural market's recovery from Covid," said Singhania.

He went on to add, “ The growth in EVs and strategic launches in premium segments also played a critical role, overcoming challenges such as supply constraints and heightened competition.”

Three-wheeler retails saw an increase of 49 percent to 11,65,699 units last fiscal from 7,83,257 units in FY23.  Singhania revealed that the sales growth in the segment was fueled by the introduction of “cost-effective CNG fuel options: and “new EV models”, alongside strong market sentiment and the seamless integration of high-quality after-sales service. Tractor sales rose to 8,92,313 units last fiscal from 8,29,639 units in 2022-23. Two-wheeler sales rose 9 percent to 1,75,17,173 units in FY24 as compared with 1,60,27,411 a year ago.

“The segment benefited from enhanced model availability, positive market sentiment and recovery of rural markets post COVID pandemic,” according to Singhania.

Commercial vehicle registrations saw an increase of 5 percent last fiscal at 10,07,006 units aided by improved vehicle supply and increased freight movement which enhanced replacement purchases.

While giving a outlook for next fiscal, he maintained, “As FY25 unfolds, the Indian Auto Industry is navigating through evolving market demands and economic conditions, leveraging its strengths for sustainable growth and a wider reach."