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Last Updated : Jan 08, 2019 03:55 PM IST | Source: Moneycontrol.com

Retail car sales in December down 3%, two-wheeler up by 11%

Car makers undertook inventory correction post the festive season that brought down wholesale billing though sales during the festive period

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Retail sales of cars slipped three percent in December even as some manufacturers like Maruti Suzuki decided to stop pushing sales to dealers to trim inventory.

According to the Federation of Automobile Dealers Association (FADA), car makers corrected inventory after the festive season bringing down wholesale billing. At the same time, sales during the festive period were disappointingly low.

Retail sales of passenger vehicles (PV) during December stood at 2.02 lakh as against 2.08 lakh in the same month last year as per FADA.


“Moderation in wholesale billing in the month of December and some reasonably good retail sales, towards the month end, has definitely helped in reducing the extremely high passenger vehicle inventory, to reasonable levels in many markets. Continued efforts in the right direction by all OEMs (original equipment maker) in the PV segment will surely bring down the Inventory levels to normal across all geographies by January end,” stated a report from FADA released today.

India’s four biggest car makers – Maruti Suzuki, Hyundai, Mahindra & Mahindra, Tata Motors – who together control more than 80 percent of the domestic market, posted just two percent growth in December

Tight liquidity, increased lending rates, poor buyer sentiment and lack of new model launches impacted sales during December. This is despite a steady decline in fuel rates and unusually high discounts offered by all automakers and their dealers to get rid of inventory before entering 2019.

During the April-December period, retail sales of passenger vehicles went down by two percent to 1.91 million units as compared to 1.96 million units sold in the same period last year.

Two-wheelers (2W) bucked the trend posting a growth of 11 percent to 1.14 million units in December as against 1.02 million sold last year same month. During the April-December period, retail sales of 2Ws rose by five percent to 11.07 million units as compared to 10.53 million units sold in the same period last year.

“FADA would like to highlight that the inventory of two-wheeler dealers still continues to be very high and we hope that positive steps are being taken and wholesale billing in January will be moderated, as per the month's retail situation,” further said the statement.

According to a survey conducted by FADA among its members, the current inventory of PVs ranges from 35-40 days, two-wheelers' ranges from 55-60 days and commercial vehicle ranges from 35-40 days.
First Published on Jan 8, 2019 03:55 pm