Poor demand for two-wheelers, chip crisis hit auto sales

This decline again came on the back of poor demand for two-wheelers. The high volume segment reported sales of 10,17,785 units last month, down 13% compared to January 2021 sales.

Published: 08th February 2022 11:41 AM  |   Last Updated: 08th February 2022 11:41 AM   |  A+A-

Covid-19 hit retail sales worse that expected, shows FADA (Photo| EPS)

Covid-19 hit retail sales worse that expected, shows FADA (Photo| EPS)

By Express News Service

NEW DELHI:  Retail auto sales (vehicle registration) fell nearly 11% in January 2022 to 14,39,747 units, according to the data released by FADA (federation of auto dealers associations). The same had stood 16,12,130 units in January 2021. 

This decline again came on the back of poor demand for two-wheelers. The high volume segment reported sales of 10,17,785 units last month, down 13% compared to January 2021 sales. When compared with the pre-Covid month of Jan 2020, 2-wheeler sales fell over 20%. 

Earlier this month, the two-wheeler industry posted a 21% decline in wholesales on a YoY basis in January 2022 (as per data released by 6 major Original Equipment Manufacturers).

 “January 2022 saw the two-wheeler industry post a 14% sequential growth in domestic wholesale volumes (as per data released by 6 major OEMs). However, the sales were 21% lower on a YoY basis, highlighting the adverse impact of price hikes, fuel inflation, and Omicron-related concerns on consumer sentiments,” said Rohan Kanwar Gupta, Vice President & Sector Head - Corporate Ratings, ICRA. 

Coming to the passenger vehicle (PV) industry, FADA reported a decline of 10% Y-o-Y in retail sales last month to 2,58,329 units. The fall came as manufacturers have been struggling to produce vehicles in full capacity due to the global shortage of semiconductors. 

FADA President Vinkesh Gulati said, “Auto retails weak performance of -18.4% compared to January ’20 (a pre-Covid month) continues to show that India is yet to recover from the Covid effect, which gripped the world 2 years ago.” Overall auto sales stood 14,39,747 in January ‘22, down 11% Y-o-Y.

Only commercial vehicles and three-wheelers witnessed an uptick in demand last month. Gulati added, “In spite of good demand, PV continues to face the brunt of semi-conductor shortage resulting in a void of a healthy inventory. Coming to two-wheeler category, the rural distress coupled with price rise and Omicron wave played a villain’s role for this segment.”



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