According to data released by the Federation of Automobile Dealers Associations (FADA),retail auto sales increased by 12% during this year’s festive season, fueled by strong demand for two-wheelers.Over 4.29 million vehicles were sold during the 42-day period from the first day of Navratri to 15 days after Dhanteras (October 3 to November 13), compared to 3.84 million units in the same period last year.
Two-Wheelers Lead the Charge
Two-wheelers emerged as the top-performing segment, with sales rising 14% to 3.31 million units from 2.91 million units in the previous year. Rural demand played a significant role in this growth. FADA noted that the share of rural two-wheeler sales increased from 53% to 56% in October, contributing significantly to the festive season’s overall performance.
Passenger and Three-Wheeler Growth
Passenger vehicle sales grew 7.1% year-on-year, with 603,000 units sold compared to 563,000 in 2023. Discounts and pent-up demand were key drivers in this segment. Similarly, three-wheeler sales saw a 14% increase, reaching 160,000 units, up from 150,000 the year before.
Mixed Performance in Commercial Vehicles and Tractors
Commercial vehicle sales rose marginally by 1% to 129,000 units, compared to 127,000 last year. However, tractor sales declined by 2%, with 85,216 units sold versus 86,640 in the previous year.
Weather Disruptions Impact Targets
While the auto sector experienced strong festive sales, unseasonal rains and Cyclone Dana in regions like South India, Bengaluru, Tamil Nadu, and Odisha impacted potential growth. “We could have fully met or even exceeded our targets of 4.5 million units if not for these weather disruptions,” said FADA President C.S. Vigneshwar.
Inventory Concerns Persist
FADA anticipates a clearer inventory picture by November’s end. Dealers have urged original equipment manufacturers (OEMs) to focus on liquidating stock to achieve an ideal inventory level of 21 days. “OEMs are finally listening to our plight. By the end of this month, we expect inventory levels to reduce further to 70-75 days,” Vigneshwar added.
Positive Outlook Ahead
The upcoming 4.8 million weddings in the next two months are expected to boost auto sales further. Commercial vehicle sales could also benefit from increased government infrastructure spending, while tractors may see better performance due to favorable rainfall and higher crop Minimum Support Prices, providing farmers with increased purchasing power.
