Passenger vehicle retail sales dip 7 pc in June

New Delhi: FADA reported a 7 per cent reduction in passenger vehicle retail sales in India in June due to a 15 per cent decrease in showroom visits caused by severe heatwave conditions.

In total, there were 2,81,566 passenger vehicle registrations last month, down from 3,02,000 in June 2023."In spite of enhanced product availability and significant discounts to boost demand, market sentiment is still low because of extreme heat causing a 15 per cent reduction in walk-ins and delayed monsoons," stated Manish Raj Singhania, President of the Federation of Automobile Dealers Associations (FADA).

The dealer mentioned that challenges such as low customer inquiries and delayed purchase decisions were highlighted in the feedback. Singhania also pointed out that the stocks of passenger vehicles have hit a record high, with a range of 62 to 67 days.

He mentioned that it is important for passenger vehicle Original Equipment Manufacturers (OEMs) to be cautious since the festive season is still a bit far off. Singhania emphasized that it is crucial to have efficient inventory management strategies to reduce the financial burden of high interest expenses.

He added that FADA is encouraging passenger vehicle OEMs to adopt careful inventory management and actively communicate with the market. In June, the number of two-wheeler registrations increased by 5 per cent compared to the previous year, reaching 13,75,889 units.

Singhania stated that factors like intense heat led to a 13 percentage decrease in potential customers visiting showrooms. He mentioned that rural sales were particularly impacted by delayed monsoon and market slowdowns related to elections, with a decrease from 59.8 per cent in May to 58.6 per cent in June. Sales of commercial vehicles decreased by 5 per cent last month to 72,747 units, down from 76,364 units in June 2023.

Singhania mentioned that the industry is still experiencing a decline due to the influence of hot weather on agriculture and delays in infrastructure projects. In June, sales of tractors dropped by 28 percent compared to the previous year, with 71,029 units sold.