India’s PV sales increase to highest-ever level in August
Sales of passenger vehicles in the country increased to its highest-ever level last month on back of robust demand for sports utility vehicles, however, wholesale volumes of entry cars and motorcycles remained weak due to pressure on disposable income of consumers at the lower end of the market.
According to data available with industry body Society of Indian Automobile Manufacturers (SIAM), as many as 359,228 passenger vehicles were sold in August, which is an increase of 9.4% over 328,376 units sold in the corresponding period of the last financial year.
Vinod Aggarwal, President, SIAM said, “Last month saw the highest ever August month sales for passenger vehicles and three-wheelers, while two-wheeler sales remained at levels similar to a year ago. We have also observed good growth in commercial vehicle segment in August 2023.
Demand remained strong especially for newer models launched in the utility vehicle segments by Maruti Suzuki, MG Motor and Hyundai, mirroring the shift in consumer preference towards feature-packed larger cars. “Vehicle financing is more easily available in urban markets where demand remained positive. However, volumes of smaller/entry level cars for most OEMs have registered a decline as there seems to be a lag in the rise of income of entry level consumers particularly in Tier 2, 3 and rural markets”, Dhruv Mudaraddi, Research Analyst, StoxBox, said.
Three-wheeler sales in the month under review went up by 69% to 64,763 units. Sales of two-wheelers remained flat at 1,566,694 units in August. Automakers in India mostly report wholesale dispatches from factories to dealerships and not retail sales to customers.Mudaraddi said two-wheeler sales last month remained weak, particularly in the entry level internal combustion engine (ICE) segment owing to price hikes. However, the mid-sized and premium two-wheeler segment registered healthy growth owing to shifting consumer preferences and higher number of newer models available at attractive prices due to healthy competition among OEMs.Industry executives are optimistic of consumer sentiments reviving in the entry-level segments during the festive season on back of strong macro-economic fundamentals and a revival in monsoons after scanty rains in August. “Based on the performance of last month, we are even more optimistic for demand to pick up during the festive season, enabled by positive economic outlook and the revival of monsoon after a deficit in August”, Aggarwal added.Mudaraddi agreed, “We expect the demand for entry level two-wheelers to recover in the coming months as the monsoon season advances and rural income increases. The order book for the newer models remain strong and the demand is expected to grow further in the coming months as the festive season kicks off.”
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