Representational image.
The 42-day festive period was the worst in a decade for the automotive sector thanks to the semiconductor supply crunch and poor demand for two-wheelers.
According to retail sales data supplied by the Federation of Automobile Dealers Association (FADA), 2.09 million registrations of new vehicles during the festive days was 18 percent lower than the same period FY21 and nearly 21 percent lower than FY20.
The 42-day period includes Navratri, Dussehra and Diwali. The data does not include registrations done in Andhra Pradesh, Madhya Pradesh, Lakshadweep and Telangana. Typically, the festive days generate 30-40 percent of the yearly volumes.
Vinkesh Gulati, President, FADA said, “We have witnessed the worst festive season in the last decade.”
Passenger vehicle (car, SUV and van) volumes dipped 26 percent to 324,542 units compared to FY21. Subdued supplies from carmakers was the single biggest problem for the industry rather than retail demand.
“Semiconductor shortage which was already a full-blown crisis showed its true colours when in spite of a healthy demand, we could not cater to customer’s needs as SUV, compact SUV and luxury categories witnessed huge shortage of vehicles. On the other hand, entry level cars saw subdued demand as customers in this category continued to conserve money due to their family’s healthcare needs,” Gulati added.
Maruti Suzuki, Hyundai, MG Motor, Renault, Mahindra & Mahindra, Tata Motors struggled to produce as per schedule due to the chip shortage. As per estimates the industry is sitting on pending bookings of 550,000 units, including 250,000 bookings of Maruti Suzuki and more than 200,000 of Tata Motors and Mahindra & Mahindra.
Waiting period on several models have crossed 6 months while in the case of the newly-launched Mahindra XUV700 the waiting period is one year on certain variants. The average inventory for the PV sector remained low at 10-15 days as against the usual 35-40 days.
Two-wheeler registrations dipped 18 percent to 1.57 million units during the festive period as against the same period in FY21. The average inventory for the two-wheeler sector was higher at 40-45 days compared to its usual 35-40 days. Poor demand from the rural pockets was one of the primary reasons behind the fall in sales of two-wheelers.
“The two-wheeler category continues to face the brunt of low sales with the entry level category being the biggest spoilsport. The rural distress in retails coupled with frequent price hikes, triple digit fuel prices and customers conserving funds for healthcare emergencies kept the demand low. In fact, walk-in’s and customer inquiries were also ultra-lean during the said period,” Gulati added.
Commercial vehicles (CV) and three-wheeler segment, bucked the broader trend to post a growth in sales although the comparison was made on a low base. CVs recorded nearly 10 percent growth in volumes to 77,066 units as compared to FY21 but lower than FY20 volumes.
Three-wheeler volumes marked a jump of 53 percent to 52,802 units compared to FY21 but still lower by 39 percent when compared to FY20. The growth in volumes was powered by demand for electric three-wheelers.
“Even though the festive period is now over, there is still a huge backlog of order in the PV segment. If PV makers are able to realign supply with demand, we can still see a good year end retail. FADA requests two-wheeler makers to rationalise inventory. It also urges to roll out attractive schemes for customers so that demand, especially in the entry level category can be revived,” Gulati added.No festive cheer for auto sector as sales slump to decade low - Moneycontrol.com
Read More
No comments:
Post a Comment