Total auto retail sales in March 2022 stood at 16,19,181 units as against 23,12,868 units sold in March 2020 when the first lockdown due to the Covid-19 pandemic was imposed, according to data released by auto dealers body Fada. While this is a 30% drop, on an annual basis the total auto sales dropped by just 3% as total sales in March 2021 stood at 16,66,996 units.
Vinkesh Gulati, president, Federation of Automobile Dealers Associations (FADA), said, “The Indian auto industry during March tried its best to be at par YoY but fell short by -3% and -30% when compared to March 2020 (a month which saw BS4 to BS6 transition)."
He added, "The 2W segment which was already a non-performer due to rural distress, saw further dampening due to rise in vehicle ownership cost coupled with rising fuel cost."
2W sales in March 2022 stood at 11,57,681 units, a decline of 4% YoY and 37% when compared with March 2022 sales.
"I once again urge all 2W OEMs to introduce special schemes to uplift the morale of this segment to boost sales," said Gulati.
He added that PVs (passenger vehicles) continue to see high demand and long waiting period as semi-conductor availability still remains a challenge even though supplies slightly improved from the previous month.
PV sales in March 2022 stood at 2,71,358 units, down 5% YoY. When compared with March 2020, PV sales last month grew by 24%.
On the near-term outlook, Gulati said that with the impact of the Covid lockdown during the last two Aprils (FY20 and FY21), April 2022 will see growth, though on a low base. This, however, when compared to a pre-Covid year will still be deep in the red.
He added that the near-term outlook for the Indian auto industry continues to remain a challenge as the ongoing Russia-Ukraine war and China lockdown do not hint towards a smooth path.
"Crude is on the boil and hence fuel prices have been raised by around Rs 10. This will continue to rise and further hit sentiments on lowering spending. Along with this, the increase in raw material costs has made OEMs increase the prices of their vehicles. While no dent in terms of demand has been seen in the PV segment, it will definitely have its impact on the 2W segment which is an extremely price sensitive market."
He added, "Precious metals and neon gas which comes from the war zone will further slow the supply of semi-conductors thus making waiting periods longer for PVs. Overall, Fada remains extremely cautious in terms of any recovery in sight until the Russia-Ukraine war and China lockdown come to an end."