The Federation of Automobile Dealers Association reports that vehicle sales are increasing year-on-year but, compared to the pre-pandemic level, overall sales are still down by 8 percent.
Federation of Automobile Dealers Association (FADA) has released vehicle retail data for January 2023. According to this data, the total vehicle retail data for January 23 has increased by 14 percent year-on-year. Two-wheeler, Three-wheeler, Passenger vehicle, tractor as well as commercial vehicle sales An increase of 10 percent, 59 percent, 8 percent and 16 percent has been recorded respectively. Although the sales are increasing year-on-year, but compared to the pre-pandemic level, the total sales are still 8 percent less. For example, the two-wheeler segment has registered a growth of 10 percent since January 2022.
It has declined by 13 percent as compared to the pre-pandemic level of January 2020. Similarly, the three wheeler segment is almost back to pre-pandemic levels with 60 percent year-on-year growth but still a 3 percent decline from pre-pandemic levels. Tremendous growth has also been recorded in the passenger vehicle category. Sales of commercial vehicles and tractors have increased at the pre-pandemic level, registering an increase of 6 percent and 9.5 percent, respectively.
Total retail sales up 14 percent in January 2023
FADA President Manish Raj Singhania said that overall retail sales have seen a growth of 14 percent in January 2023 but it is still 8 percent less than the pre-covid month of January 2022. All categories two-wheeler, three wheeler, passenger vehicle, tractor and commercial vehicle have registered an increase of 10 percent, 59 percent, 8 percent and 16 percent respectively.
Automobile Sector Term Growth Outlook
The report also throws light on the near term growth outlook of the automobile sector. It said that Chinese factory activities are once again gaining momentum, there will be an improvement in the global supply of parts and semiconductors, which will lead to better vehicle supply and shorter waiting periods in the future. This will further fuel growth for the already healthy passenger vehicle segment in the state.
It has been said in this report that the recent announcements made in the budget 2023-24 will help in the overall growth of automobile retail. Increased income tax exemption, budget allocation for vehicle scrappage policy and import duty exemption for manufacturing of lithium batteries will help in boosting the demand for entry-level two-wheelers and entry-level PVs in the country.