Indian passenger vehicle retail sales drop 7 per cent in June amid severe heatwave impact

Despite efforts to boost sales with discounts, India's passenger vehicle retail market saw a significant 7% decline in June due to reduced showroom visits amidst extreme heatwave conditions.
Representative image
Representative imageFile Photo

NEW DELHI: Passenger vehicle retail sales in India experienced a 7% year-on-year decline in June, attributed to severe heatwave conditions that led to a 15% reduction in showroom visits, according to the Federation of Automobile Dealers Associations (FADA).

The industry body reported that overall passenger vehicle registrations totaled 2,81,566 units last month, down from 3,02,000 units in June 2023.

"Despite efforts to improve product availability and significant discounts aimed at boosting demand, market sentiment remains subdued due to the extreme heatwave and delayed monsoons," said FADA President Manish Raj Singhania in a statement.

Singhania highlighted challenges such as reduced customer inquiries and postponed purchase decisions among dealers.

He also noted that passenger vehicle inventory levels have reached a historic high, ranging from 62 to 67 days.

"With the festive season still ahead, it's crucial for OEMs to exercise caution," Singhania emphasized, urging them to implement effective inventory management strategies to mitigate financial strain from high interest costs.

Meanwhile, two-wheeler registrations saw a 5% year-on-year increase to 13,75,889 units in June, despite a 13% decrease in showroom visits due to the heatwave.

Rural sales of two-wheelers declined slightly from 59.8% in May to 58.6% in June, affected by stalled monsoons and election-related market slowdowns.

Commercial vehicle sales also declined by 5% to 72,747 units, attributed to high temperatures affecting the agricultural sector and slowdowns in infrastructure projects.

Tractor sales witnessed a significant drop of 28% year-on-year to 71,029 units in June.

However, three-wheeler registrations rose by 5% to 94,321 units compared to the previous year.

Overall retail sales across all vehicle segments marginally increased year-on-year to 18,95,552 units in June.

Looking ahead, FADA expressed cautious optimism for July's auto retail performance, anticipating potential growth in the commercial vehicle sector driven by renewed infrastructure projects and seasonal demands.

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The New Indian Express