The Indian auto retail sector recorded a robust 27 per cent year-on-year (YoY) growth for April 2024, according to Federation of Automobile Dealers Associations (FADA) Vehicle Retail Data.
The report highlights positive market sentiments, driven by stable fuel prices, a positive monsoon outlook, festive demand, and the marriage season.
According to FADA President Manish Raj Singhania, the two-wheeler (2W), three-wheeler (3W), passenger vehicle (PV), tractor (Trac), and commercial vehicle (CV) segments witnessed growth.
Singhania said, "In April 2024, the Indian Auto Retail sector achieved a robust 27 per cent YoY growth. The two-wheeler (2W), three-wheeler (3W), passenger vehicle (PV), tractor (Trac) and commercial vehicle (CV) segments grew by 33 per cent, 9 per cent, 16 per cent, 1 per cent, and 2 per cent, respectively. While some attribute this growth to the shift in Navratri to April instead of March last year, the overall increase was significant. Comparing combined March and April 2024 with the same period last year shows a 14 per cent YoY growth for the entire industry."
Singhania attributed this growth partly to the shift in Navratri to April from March last year, but noted that the overall increase was significant. When comparing combined March and April 2024 with the same period last year, the industry recorded a 14 per cent YoY growth.
In the two-wheeler segment, significant growth was driven by improved supply and increasing demand for 125cc models. Positive market sentiments, supported by stable fuel prices and a favorable monsoon outlook, contributed to this rise.
New model launches also played a role in driving growth, despite some delays in supply.
The passenger vehicle category experienced double-digit YoY growth, aided by enhanced model availability and positive market sentiments, particularly around festive events like Navratri and Gudi Padwa.
Despite strong bookings and customer flow, challenges such as high competition, excess supply, and discounting posed hurdles for sustained growth. Additionally, the lack of new models in some portfolios impacted market traction.
The commercial vehicle segment showed a modest 2 per cent YoY growth and a 0.6 per cent month-on-month (MoM) decline, indicating varied market conditions.
Positive momentum was found in bulk and corporate deals, as well as school bus demand, although elections dampened sentiment, leading customers to delay expansion plans. Limited finance options and regional challenges, such as water scarcity, further impacted performance.
Looking ahead to May 2024, several positive indicators are shaping the near-term outlook.
Improved vehicle supply and strategic planning in the two-wheeler segment have led to rising customer bookings and better market sentiment. In the passenger vehicle segment, new model launches and favorable monsoon forecasts are expected to stimulate customer interest.
Challenges remain, with election uncertainty affecting market sentiment and financial constraints posing growth hurdles. Extreme temperatures and overcapacity in the commercial vehicle segment could further slow growth.
Despite these challenges, the auto industry remains cautiously optimistic, with market opportunities arising from rising customer interest in new models. Monitoring election-related uncertainty and financial constraints will be crucial for navigating the evolving market effectively. (ANI)
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