Synopsis
In January, car sales in India saw a remarkable rise of 15.53%, totaling 4,65,920 units, in contrast to 2,93,465 units from the previous year. Month-on-month sales also surged by 58.77%, indicating positive trends in the automotive sector.Key Takeaways
- Car sales rose by 15.53% to 4,65,920 units in January.
- Month-on-month sales showed an increase of 58.77%.
- Improved inventory levels at 50-55 days.
- Positive indicators include the wedding season and promotional activities.
- Dealer confidence is high, with 46% expecting growth in February.
New Delhi, Feb 6 (NationPress) Car sales in India experienced a significant increase of 15.53 per cent, reaching 4,65,920 units in January this year, compared to 2,93,465 units during the same month last year, as per data released by the Federation of Automobile Dealers Associations (FADA) on Thursday. Month-on-month, car sales rose by 58.77 per cent.
FADA President CS Vigneshwar noted, "Passenger vehicle (PV) sales have shown strong growth, although part of this increase is due to December purchases being registered in January for model year advantages."
He added, "Inventory levels have improved, decreasing by approximately five days to 50-55 days, indicating a better supply-demand balance. Many dealers have reported increased demand, but also pointed out that last year’s significant discounts helped clear older models and facilitate registrations."
The report highlights several positive indicators, including the wedding season and promotional activities, anticipating sustained interest in cars, SUVs, and two-wheelers due to the upcoming wedding demand and new product launches.
Additionally, the budget's exemption from income tax for individuals earning up to Rs 12.75 lakhs annually is expected to enhance vehicle demand, now covering 1 crore individuals.
Two-wheeler sales also increased by 4.15 per cent year-on-year to 15,25,862 units, driven by new model launches, the ongoing wedding season demand, and improved financing options.
This trend is particularly evident in the rural sector, which recorded a stronger vehicle purchase growth of 18.57 per cent compared to 13.72 per cent in urban areas, according to FADA statistics.
Commercial vehicle sales climbed 8.22 per cent year-on-year to 99,425 units, spurred by higher freight rates and strong demand for passenger carriers, while three-wheeler sales rose 6.86 per cent to 1,07,033 units.
Additionally, tractor sales increased by 5.23 per cent year-on-year to 93,381 units, reflecting an improved agricultural season that has boosted farmers' incomes.
The report indicates that select lenders are providing better financing options, and backlogged commercial vehicle orders are fostering cautious optimism for future growth.
Dealer confidence has reportedly increased, with nearly 46 per cent expecting growth in February, reflecting hopes for stable-to-rising sales.
According to FADA, 46 per cent of dealers expect sales to rise in the upcoming month, 43 per cent anticipate stable sales, and 11 per cent foresee a downturn. Factors such as the ongoing wedding season, new car and motorcycle launches, improved inventory management, and better financing options are contributing to this optimism in a typically constrained month.
However, Vigneshwar cautioned that strict lending standards, rising vehicle costs, and subdued demand in certain industries may negatively affect overall performance.
