Vehicle registrations across segments declined by 70 per cent in April over the year-ago period as most of the businesses remain shut during the month amid the nationwide lockdown in the wake of coronavirus pandemic, a report said on Tuesday.
Wholesale volumes were lower than registrations as dealers have been focusing on clearing existing inventories, and original equipment makers (OEMs) are yet to ramp-up operations, Emkay Global Financial Services said in its report on the auto industry.
Vehicle registrations in April stood meagre at around 21,000 units for the passenger vehicles (PV) and 19,000 units for commercial vehicles (CVs).
Besides, 3.14 lakh units for two-wheelers and 10,000 units of three-wheelers were also registered during the month, the report said, quoting from the government's Vahan database.
The number of tractors that got registered in April stood at 5,000 units, it said.
Passenger and commercial vehicle makers, two- and three-wheelers and OEMs clocked zero sales volumes in the domestic market during the month, it said adding in comparison, tractor OEMs such as Mahindra & Mahindra and Escorts registered domestic volumes of 4,716 units and 613 units, respectively, it said.
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These volumes were lower by 83 per cent and 88 per cent on year-on-year-basis, as dealers recommenced registration from April 20 onwards, the report said.
However, dispatches to overseas markets have been higher than that in the domestic market formost segments, due to pending order-book and re-commencement of major ports in Mumbai, Chennai and Mundra, it said adding that the OEMs and ancillaries have received permissions and are working toward commencement of operations at most of their plants.
But, the ramp-up of plant operations for OEMs would depend on supplies from ancillaries and labour availability as dealers are gradually re-commencing operations in green and orange zones, post obtaining permissions from local authorities, Emkay Global said in the report.
In Red zones, most dealers expect to commence operations from May 18, it added.
The auto sector has endured tough times over the past six quarters due to a cyclical downturn across segments. Near-term volume performance is expected to remain under pressure, but we expect a rebound in the second half of FY2021, led by a low base, pent-up demand and better rural sentiment, the report stated.