Auto retail sales jump 13%, PV sales scale record high in February

PV sales moved up by 12 per cent to 330,107 units as compared to 293,803 units in February last year

India’s automobile retail sales jumped 13 per cent in February to 2.03 million units, compared to 1.79 million units in February 2023. The increase is attributed to enhanced vehicle availability, improved demand due to economic conditions, and the impact of marriage season, according to data from Federation of Automobile Dealers Associations (FADA).

However, the sector expects the upcoming Lok Sabha elections to play spoilsport in terms of sales due to potential deferred purchases across segments.  

Passenger vehicles (PVs) achieved record-breaking sales in February, soaring 12 per cent to 330,107 units, as compared to 293,803 units in February last year.

Other vehicle category, including two-wheelers, three-wheelers, tractors, and commercial vehicles, registered growth rates of 13 per cent, 24 per cent, 11 per cent, and 5 per cent, respectively. February 2023 also marked the highest sales ever recorded for commercial vehicles, three-wheelers, and tractors.

“The PV segment recorded a 12 per cent Y-o-Y growth, marking the highest February sales figures ever, driven by new product introductions and enhanced vehicle availability. Elevated inventory levels in the PV segment, remaining at 50-55 days, pose a significant concern, necessitating original equipment manufacturers to adjust production to reduce dealer carrying costs,” said Manish Raj Singhania, president of FADA.

Acceleration in other categories

On the other hand, the two-wheeler sector growth was mainly driven by rural demand, the popularity of premium models, and strong performance in the entry-level segment. Increased product availability and enticing offers further enhanced product acceptance. Favourable marriage dates and improved economic conditions also contributed to this positive growth. Two-wheeler sales for the reviewed period reached 1.43 million, marking an increase from 1.27 million in the previous fiscal year.

In February, three-wheeler sales touched 94,918 units, compared to 76,619 units in February 2023.  “The 3W market surged by 24 per cent, with EVs making up 53 per cent of this growth, fuelled by first-time users and a shift towards electric e-rickshaws, alongside better market sentiment and consumer engagement,” Singhania said.

The commercial vehicle segment grew by 5 per cent, buoyed by fleet purchases, demand for school buses and improved financing, despite hurdles like cash flow shortages and election-related purchase deferrals. This highlights the sector’s resilience and steady recovery. The segment saw sales reach 88,367 units in February, as against 84,337 units during the same period last year.

“The anticipation of elections casts a shadow over this positive scenario, with potential deferred purchases across segments. The commercial vehicle sector, in particular, might face a cautious approach from customers waiting for the outcome of general elections. Supply constraints further complicate the landscape, especially in the PV segment, where the availability of popular variants remains a concern. External factors like crop failures in rural areas could also dampen market sentiment and financial liquidity, posing additional hurdles to sustained growth,” Singhania said.