New Delhi-based Federation of automobile dealers association (FADA) has released vehicle retail data for January 2023. According to it, the total vehicle retail data for January 23 grew by 14% on a year-on-year (YoY) basis. Sales of two-wheeler, three-wheeler, passenger vehicle, tractor as well as commercial vehicles increased by 10%, 59%, 8% and 16%, respectively.
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Although there is a YoY rise in sales. But, when compared to the pre-pandemic level of January 20, the overall sale was still down by 8%. For example, the two-wheeler segment showed 10% growth from January 2022. But it fell by 13% when compared to pre-covid level of January, 2020, indicating that rural India is still facing post-pandemic challenges.
Similarly, the three-wheeler segment has almost clawed back to pre-pandemic levels with 60% YoY growth. But still has a de-growth of 3% to match with the pre-pandemic levels. Passenger vehicle category also continues to show robust growth.
Sales of the commercial vehicles and tractors grew about pre-pandemic levels, registering 6% and 9.5% growth, respectively.
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Manish Raj Singhania, FADA Presiden said, “January’23 witnessed total retail rising by 14% YoY but was still down by 8%, when compared to pre-covid month of January’20. All categories were in green with 2-Wheeler, 3-Wheeler, Passenger Vehicle, Tractor and Commercial Vehicles growing by 10%, 59%, 22%, 8% and 16% respectively on YoY basis”.
The report also sheds light on the near term growth outlook of the automobile sector. It says that with China’s factory activity once again gaining pace, global supplies of parts and semiconductors will see a recovery thus aiding better vehicle supplies and lower waiting period in future. This will further fuel growth for the already healthy Passenger Vehicle category, it states.
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It adds that the recent announcements in Budget 2023-24 will help aid overall growth of automobile retails. Enhanced income tax rebate, budget allocation for vehicle scrappage policy and import duty exemption for manufacturing lithium batteries will help accelerate the demand of entry level two-wheelers and entry level PV in the country. Apart from this, the capital outlay of ₹10 Lakh Cr for Infrastructure spending will help aid CV sales which is already witnessing an upswing.
