May , 2023
India’s vehicle market shows slow paced recovery
17:39 pm

Pritha Mishra

According to S&P Global Mobility, India’s sale of light automobiles fell to fourth place internationally in the first quarter of the current calendar year. In 2022, India overtook Japan to become the third-largest country. The standings between the two markets have now changed once more.

All passenger vehicles, small commercial vehicles, and vans weighing less than six tones are considered light vehicles. The trend reversal, according to experts, is due to the drying up of pent-up demand in India, rising lending rates, and a rise in vehicle pricing that have been particularly onerous on entry-level car buyers. Sales in Japan increased by 16% over the same period last year thanks to significant pent-up demand and the recovery of the economy from the pandemic. Strong pent-up demand is also present in most other markets, resulting in high prices. However, despite having grown by over 20% in the previous calendar year, India’s sales managed to grow by double digits in the first quarter, maintaining the momentum. It is anticipated that it would surpass its own record of 4.4 million light vehicles in 2022 and reach record sales of 4.7 million units in 2023.

Auto sales figures are closely monitored because they are one of the most important measures of private spending and account for more than 50% of the country’s economic development. As per Federation of Automobile Dealers Associations (FADA) figures, sales of two-wheelers, which make up 60% to 70% of all vehicle sales, decreased by 11.2% to reach 11,33,138 units. The organisation said that sales at India’s major bike and scooter manufacturers decreased as a result of increasing inflation, higher ownership costs and the rural market’s ongoing slow recovery. It also mentioned how the two-wheeler market for internal combustion engines had been harmed by rising sales of electric vehicles (EVs). The world’s largest bike manufacturer, Hero MotoCorp, had a dramatic decline in retail sales, which caused its market share for the month to drop to 29.1% from 34.8% a year earlier. SML Isuzu experienced the greatest sales growth (54.22%), and Tata Motors sold the most commercial cars (3,67,973 units).

The Indian two-wheeler division of Honda (7267.T) has competed against the New Delhi-based company this year. Passenger vehicle (PV) sales have increased by almost 8.2% in the month to 280,016 units, reaching an all-time high of more than 3.43 million units in 2022. The sustained high demand for utility vehicles (UV), which have become more popular than entry-level compact automobiles, is what drove the increase in PV sales. Retail sales information for the Financial Year 2023 has been made available by FADA. Most commercial vehicle manufacturers scale their sales with either high or low margins. As a result, this financial year’s overall sales increased by 32.88% to 9,39,741 units from 7,07,186 units. 

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