Explained: Why do automobile makers and their dealers regularly provide different sales numbers every month?

Sales of passenger cars including sports utility vehicles and vans grew 18 percent in February, automobile manufacturers said, but dealers said growth was only 11 percent.

Society of Indian Automobile Manufacturers (SIAM) and the retailers’ body Federation of Automobile Dealers Associations (FADA) generally provide different numbers for sales every month.

The variation was even wider for sales of motorcycles, scooters and mopeds in February. SIAM said sales rose 10 percent, but according to FADA the month saw a fall of 16 percent, compared to the same month last year.

SIAM numbers represent the total number of vehicles which manufacturers supply to their dealers. These are wholesale numbers. FADA data tallies retail sales from dealers to car users. This data is sourced from regional transport offices (RTO) of various states.

SIAM numbers, based on supply to dealers, do not truly reflect the actual market picture, while FADA numbers are based on offtake from actual customers.

In the past vehicle makers have been accused of dumping inventory on the dealers to shore up their market share. The alleged dumping happened irrespective of the actual demand of vehicles in the market, leading to build-up of inventory.

No. Tata Motors, Mercedes-Benz, BMW, Audi, Volvo, Jaguar Land Rover, Daimler India Commercial Vehicles do not share their wholesale data with SIAM. This makes SIAM’s sales data incomplete. Each of these companies insists on sharing retail numbers.

No. According to FADA, the data which it sources in collaboration with the Ministry of Road Transport and Highways (MORTH), is gathered from 86 percent of the total operational RTOs in India. Out of the total 1,481 RTOs, only 1,274 share the vehicle registration data with MORTH. Andhra Pradesh, Madhya Pradesh, Lakshadweep and Telangana are not part of the VAHAN portal set up MORTH which provides the registration data. Like SIAM even FADA data is incomplete.

In the case of two-wheeler sales, for instance, Madhya Pradesh alone accounts for around 20 percent of the total retail two-wheeler sales in the country. Hyderabad and other cities of Andhra Pradesh and Telangana are strong markets for four-wheelers as well as for two-wheelers.

Automotive sectors in several developed overseas such as Europe and the US rely on retail data. Besides helping the government get a clear picture of consumer demand, the data also provides real market share split between companies. Retail sales (vehicle registration) is more trustworthy than wholesale data as wholesales carry an inherent risk of manipulation.