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Exports of two wheelers, three wheelers, and commercial vehicles (CVs) have seen a fall in 2023-24. This is owing to the Russia-Ukraine and Israel-Gaza conflicts, a slowdown in the global economy, and foreign exchange crises in key markets, the Society of Indian Automobile Manufacturers (SIAM) said on Friday.
Exports of passenger vehicles (PVs) also increased marginally in 2023-24. Approximately 672,000 units of PVs were exported from India, recording a 1.4 per cent year-on-year (Y-o-Y) growth.
India exported 3.458 million units of two wheelers in 2023-24, a fall of 5.3 per cent Y-o-Y. Exports of three wheelers stood at 300,000 units, an 18 per cent Y-o-Y fall.
Meanwhile, passenger vehicle wholesales in India touched a record high of 4.2 million units in the financial year 2023-24, registering a Y-o-Y growth of 8.4 per cent, on the back of robust demand for utility vehicles
“There are geopolitical factors behind the drop in exports. There is a war going on. The global situation is also not so good. Some countries where we are very strong in two wheeler and commercial vehicle exports are facing foreign exchange issues. These are the main factors. However, in the January-March quarter, we have seen good recovery in exports. Therefore, we are hopeful that the situation will improve,” Vinod Aggarwal, president of SIAM, said.
If you look at two-wheeler exports in the last quarter, the growth has been significant. It stood at about 30 per cent, he added.
Aggarwal also talked about the impact of the Red Sea crisis on exports.
“As far as the Red Sea crisis is concerned, I think we have worked around that issue. The ships are taking a slightly longer route than the usual one. Based on that, the lead times have gone up by 15-20 per cent. Earlier, it was eight weeks. Now, it is about 10 weeks. Lead time has gone up. And due to that, the cost would have gone up a little bit. With that, the situation has been resolved,” he said.
The Red Sea crisis began on November 19, 2023, with the Iran-backed Houthis in Yemen launching their first attack on Galaxy Leader, a merchant ship. At least 25 attacks have been reported to date, and this encompasses anti-ship missiles, piracy, ballistic missiles, and unmanned aerial vehicle strikes.
He said Indian PV sales growth in 2024-25 could be in higher single digits.
“We are very positive on the growth outlook based on the fundamentals. We are expecting good growth in the economy. We are hoping for a good monsoon...The growth could be in the higher single digit,” he added.
He said there will be a temporary impact of general elections — the final count will be done on June 4 — on auto sales in the country.
“During the election season, various projects generally slow down in their execution, because the decision makers or the government machinery is busy with the electoral process. Therefore, we are expecting there would be a huge pent-up demand after the new government is formed in the first week of June. Therefore, there would be a temporary impact. Overall, the situation will be good after the elections,” he added.
