Scooters and Motorcycles Rev Up August Sales as Passenger Vehicles Slow Down | Auto News

Passenger vehicle sales in India dropped by 1.8% in August 2024, while the two-wheeler segment, led by scooters and motorcycles, grew by 9%. Automakers are optimistic about a demand revival during the festive season. Car manufacturers have reduced dispatches to manage inventory amid cooling demand.

Passenger Vehicle Sales Fall by 2% in August as Two-Wheelers See 9% Surge in Sales

Key Highlights

• Passenger vehicle sales fell by 2% in August, while two-wheelers saw a strong 9% growth.
• Scooter and motorcycle sales drove the two-wheeler segment, with both categories posting significant gains.
• Automakers remain optimistic about festive season demand despite a drop in car sales.

Passenger vehicle sales in India took a slight hit in August 2024, marking the second straight month of decline. According to data released by the Society of Indian Automobile Manufacturers (SIAM), total dispatches of passenger vehicles from factories to dealers fell by 1.8% to 3,52,921 units in August 2024, down from 3,59,228 units in the same month last year. Carmakers have been strategically reducing dispatches to manage inventory levels at dealerships amid cooling demand.

Inventory Management in Focus for Carmakers

The drop in passenger vehicle dispatches comes as automakers like Maruti Suzuki are calibrating their supply chain to align with market demand. The goal is to reduce inventory levels, which had reached record highs. Partho Banerjee, Senior Executive Officer (Marketing and Sales) at Maruti Suzuki, highlighted that the company’s inventory has come down to 36 days from 38 days, stating, “We do not want to bring this down further as lower stocks could impact vehicle availability and hurt sales during the festive season.”

The slowdown in August is attributed to high base effects from last year and strategic decisions to control stock levels. Rajesh Menon, Director General of SIAM, noted, “In August 2024, the passenger vehicle segment de-grew by (-)1.8% compared to August 2023, posting a sale of about 3.53 lakh units.”

Two-Wheelers Lead the Charge

On the brighter side, the two-wheeler segment saw a robust growth of 9% in August 2024, with 17,11,662 units sold compared to 15,66,594 units in August 2023. The surge was mainly driven by demand for scooters and motorcycles. Scooter dispatches increased by 10% to 6,06,250 units, while motorcycle sales grew by 8%, reaching 10,60,866 units.

Industry experts believe the growth is driven by consumer confidence in the two-wheeler segment, with manufacturers like Honda Motorcycle & Scooter India (HMSI) expecting rural demand to rise during the festive season. Yogesh Mathur, Director of Sales and Marketing at HMSI, mentioned, “As the monsoon stabilises, we expect rural demand to pick up during the festive season this year.”

Festive Season to Boost Demand

With the festive season around the corner, carmakers are optimistic about a rebound in demand. Festivals like Ganesh Chaturthi and Onam are expected to fuel retail sales, especially in key markets like Maharashtra and Kerala. Banerjee of Maruti Suzuki noted that bookings in Kerala had already risen by 7% in August with the onset of the Chingham month, and the company expects retail sales to pick up further during Onam in September.

SIAM’s Director General, Rajesh Menon, echoed this optimism, stating, “Looking ahead, as the country enters the festive season, demand for vehicles is expected to grow,” further adding that this demand will be supported by the PM E-DRIVE and PM-eBus Sewa Schemes announced by the government.

Three-Wheeler Segment Sees Modest Growth

The three-wheeler segment also posted a decent growth of 8% in August 2024, with 69,962 units sold, up from 64,944 units in August 2023. This reflects a positive trend in the commercial vehicle space, with increased urban mobility driving the demand for three-wheelers.

What’s Next?

As the Indian automotive industry enters the festive season, the outlook for sales remains positive. With reduced inventories at dealerships and demand expected to rise, manufacturers are gearing up for what could be a much-needed boost in vehicle sales. The growth in two-wheeler sales, particularly scooters, signals a healthy consumer sentiment, while passenger vehicle sales are likely to pick up as festivals bring customers back into showrooms.

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