Auto retail sales slump by more than 9% in Sept., PV sales slip 19%: FADA

FADA reports 9.26% YoY decline in auto sales, with PV sales plummeting 18.81% YoY, urging RBI for stricter guidelines.

Overall automobile retail sales in September witnessed a decline of 9.26% YoY, according to the data released by the Federation of Automobile Dealers Association (FADA) on Monday. 

Except for three-wheelers and tractors whose sales grew 0.66% and 14.69% YoY respectively, other categories such as two-wheelers, passenger vehicles (PV) and commercial vehicles (CV) fell by 8.51%, 18.81%, and 10.45% YoY, respectively.

The two-wheeler sales declined by 10% Month on Month (MoM’) and 8.5% YoY due to low consumer sentiment, poor inquiries, and reduced walk-ins. Seasonal factors like the Shraddh period, Pitrapaksha, and heavy rains further impacted demand, resulting in delayed purchases and a subdued market environment, FADA said. 

Three-wheeler sales showed marginal growth of 0.99% MoM and 0.66% YoY, driven by positive customer engagement and increasing demand for e-rickshaw options. However, overall demand remained subdued as many customers deferred purchases in anticipation of the upcoming festive season and heavy rains impacted walk-ins and sales activity, FADA added.

CV sales increased by 1.46% MoM but declined by 10.45% YoY, reflecting mixed performance. While there was positive sentiment and marginal growth in regions supported by infrastructure projects, overall demand remained weak due to low government spending, extended monsoon delays and seasonal challenges. Despite some improvement in fleet purchases, the market conditions remain subdued, it further said.

“In the PV category, sales plummeted by 10.8% MoM and 18.81% YoY, signalling an alarming trend of declining consumer demand and deteriorating market sentiment. Seasonal factors such as Shraddh and Pitrapaksha, coupled with heavy rainfall and a sluggish economy, have exacerbated the situation,” it pointed out. This is the 4th consecutive month that PV sales have declined. 

C S Vigneshwar, President, FADA in a statement said, “Despite the onset of festivals such as Ganesh Chaturthi and Onam, dealers have reported that the performance has been largely stagnant. This suggests that overall market sentiment during these festive periods has been underwhelming, with a trend leaning towards flat or negative growth,” he added.