India's car sales smash record in January, two-wheelers see strong rural demand
Passenger vehicle sales in India smashed a new record in January 2024, claimed the Federation of Automobile Dealers Associations (FADA) in a release on Tuesday. The association stated in its vehicle retail data that the passenger vehicles sold 393,250 units last month, up 13.30 per cent from 347,086 units registered in the same month a year ago, while month-on-month (MoM) sales too surged by 34.21 per cent from 293,005 units recorded in December last year.
FADA noted that with this retail number, the passenger vehicle segment in India achieved a new all-time high for January. With this, the industry surpassed the previous record set in November 2023. However, FADA also said that a persistent concern lies in high inventory levels, which still hover in the 50-55 day range, posing a challenge for automobile dealers across India. The association further claimed that the record sales of passenger vehicles played a key role in the overall growth of the industry which achieved a 15.03 per cent retail sales growth.
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Speaking about the sales performance, FADA President Manish Raj Singhania has attributed the retail growth to the high demand for SUVs, the launch of new models, improved availability, effective marketing, wedding season etc. “A record-breaking month, the PV segment achieved all-time high retail sales of 3,93,250 units and impressive 13 per cent YoY growth. SUV demand, along with the introduction of new models, greater availability, effective marketing, consumer schemes and the auspicious wedding season, underpinned this strong performance," he said.
Strong rural demand propelled two-wheeler growth
While the passenger vehicle segment smashed a new highest monthly sales record, the two-wheeler segment too registered a 14.96 per cent year-on-year (YoY) growth at 14,58,849 units in January 2024, up from 12,68,990 units sold in the corresponding month of 2023. Also, FADA reported that sales of two-wheelers across India surged 0.63 per cent on a MoM basis last month, up from 14,49,693 units recorded in December last year.
The association has attributed the strong and steady demand for the two-wheelers to this sales surge. It also stated that the continued strong rural demand due to good crop production, a good monsoon and continuous government support for the rural economy helped the segment to post such retail growth.
Speaking about two-wheeler sales growth, FADA President Singhania said that despite the supply shortages, increased interest in electric vehicles too helped the two-wheeler segment to grow. “Several positive trends in the two-wheeler market signalled a robust start to the year. Improved vehicle availability, due to adjustments post-OBD 2 norm implementation, the introduction of new models and a shift towards premium options all contributed to increased demand. This, combined with a good harvest, a positive marriage season and effective follow-ups and offers, indicate a favourable trajectory for the two-wheeler sector. Furthermore, despite supply shortages, increased interest in electric vehicles highlights evolving consumer preferences within this segment," he further added.