Automakers’ sales to dealers fall 1.8% YoY in Q2 as SUV demand stuck in slow lane

Indian automakers’ sales to dealers witnessed their first decline in the July to September quarter of the financial year 2024, Reuters reported on Monday, October 14. This is the first decline in over 10 quarters as big car demand has slowed down. 

The sales figures to dealers dropped 1.8 per cent during July, August and September months, compared year-on-year, to 1.06 million in the second quarter of the financial year 2024-25, the report citing Society of Indian Automobile Manufacturers (SIAM) data stated.

The sales growth previously slowed down to 3 per cent in the first quarter of the financial year 2024-25, from 4.7 per cent a year ago, as per the report.

Dealers and automobile manufacturers have blamed the fall in numbers on the more-than-usual rains in June and July. This year’s pre-festive season, an inauspicious time for making big purchases, fell entirely in September this year, compared to October the previous year, as per the report.

“Heavy rainfall in key states … did impact the sales numbers of some of the segments,” Shailesh Chandra, president of SIAM, was quoted as saying in the report

According to the report, sales of sports utility vehicles (SUVs) and utility vehicles slowed to 9 per cent in the second quarter, compared to 23.5 per cent the previous year. 

SIAM’s Future Outlook

The auto industry has been fuelled by SUV sales, which account for one-third of the total sales in the last three years. This has helped Mahindra and Mahindra, and Toyota, reported the agency.

The slowdown in the SUV segment sales was magnified by an almost 20 per cent fall in small car sales, impacting market leaders like Tata Motors, Maruti Suzuki, and Hyundai India, as per the report.

SIAM President Chandra estimated that sales growth would return in the third quarter of the financial year 2024-25, fuelled by the festive season’s demand.

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