As many as 291,928 cars, sedans and utility vehicles were sold in the local market last month, a jump of 11% over 262,984 units reported in the same period last fiscal, shows data available with industry body Society of Indian Automobile Manufacturers (SIAM). The wholesale volumes would be even higher at 335,269 units if we were to include the volumes of Tata Motors which has stopped reporting data monthly to SIAM.
Automakers in India mostly report wholesale dispatches from factories to dealerships and not retail sales to customers.
This is the highest sales volume recorded by the industry for February.
“Overall positive sentiments in the market continues, which is also driven by encouraging announcements at the Union Budget for consumers,” said Vinod Aggarwal, president, SIAM, adding the hike in repo rates last month, which would result in higher cost of borrowings, remains a concern. The industry hopes that the rates would get moderated ‘suitably.’
Shashank Srivastava, senior executive director (marketing and sales) at market leader Maruti Suzuki, said “Demand is good. Our enquiries grew by 12% during the month. There could be some impact on consumer demand due to recent hikes in retail lending rates.” The company had pending orders for 369,000 vehicles at the start of the month.
The increase in CNG prices the last few months has started impacting sales of vehicles powered by the fuel. Aggarwal said, “Moderation of CNG fuel prices is also important for expanding the footprint of gas based mobility which is critical for sustainable mobility.”
Rajesh Menon, director general, SIAM said, “Passenger vehicles posted its highest ever sales of February and the three-wheeler segment posted appreciable growth this month, compared to last two years. The two-wheeler segment posted a moderate growth of 8% in February 2023, compared to February 2022.” Cumulative sales of two-wheelers and three-wheelers in the first 11 months of the fiscal, however, are yet to reach pre-covid levels.
“Channel checks indicate continued strength with healthy double-digit growth (in the passenger vehicle segment)”, Emkay Global Financial Services said in a note earlier this month. In the two-wheeler segment, the firm said, demand is set to improve on a low base and on back of demand in the marriage season.
Overall, sales of vehicles across segments increased 9.8% to 1,472,078 units in February.
Separately, SIAM said the automobile industry is fully geared up for transition to Phase 2 of BS 6 Emission Norms for all categories of vehicles from next month.