FADA expects new car launches to go up ahead of festive season after 2021 woes

After losing two years to Covid-19 pandemic, the Federation of Automobile Dealers' Association (FADA) is hoping for some festive cheer this year. The auto dealers' body expects the number of new car launches in the festive season to increase by at least double this year. Several carmakers, including Maruti Suzuki, Hyundai and Toyota, are expected to launch some of the most anticipated models just before the festive season kicks in. Cars like Grand Vitara, Urban Cruiser Hyryder and Tucson are already lined up for launch likely by September-end.

Vinkesh Gulati, President at FADA said that the festive season in the previous year was the worst in a decade for the auto dealers. He hopes high demand for new cars will help turn things around. However, he also said that low sales in the two-wheeler segment, barring the EVs, remain a concern. Gulati was quoted by news agency PTI saying, "If I compare with the last two years, you will find at least double the model launch during the festive season. Moreover, we are seeing a lot of electric vehicles being launched also. So you will find a lot of launches (ahead of the festive season)."

Gulati said that SUVs will dominate new car launches ahead of Diwali this year. Besides the three SUVs already mentioned, other new models or facelift models are expected to hit the market before Diwali. Gulati said, "90 per cent of the launches (will be) driven towards the SUV segment. We are seeing good footfalls and enquiries at the dealerships. No doubt there are issues like high waiting period in the car segment, which is a deterrent to the customer. But customers are still supporting the dealerships despite a long waiting period."

According to FADA, Indian carmakers are manufacturing around 3 lakh units every month. This could increase to 3.5 lakh units a month based on projections shared by top five carmakers, which include Maruti Suzuki, Hyundai Motor, Tata Motors, Mahindra and Mahindra and Kia India. "But even if they do 3 lakh, they will be too above the past year," Gulati said.

The ICE two-wheeler segment has seen a dip in sales in recent times. For FADA, it remains a concern. Gulati said, "Non-electric two-wheelers' demand is the biggest stress. And this is the worry for FADA," Gulati said. He pointed a number of reasons behind it, which include factors like BS 4 to BS 6 transition that led to increase in prices, high price of petrol among others.