Scooters and bikes sell less in March as Indian auto industry feels the stress
- FADA data highlights pain points with the near-term outlook quite grim as well due to factors such as fuel price hikes, supply-chain issues and rising cost of ownership.
The Federation of Automobile Dealers Associations (FADA) released registration figures for the month of March in India with the numbers pointing to a grim outlook, especially due to the under-performing two-wheeler segment in the country. A wide variety of factors remain as omnipresent challenges for the Indian automotive industry at large with FADA pointing to fuel price rise, rising cost of ownership, supply-chain issues - among others - as some of the stumbling blocks.
According to FADA, overall retail for the month of March this year was down by three per cent when compared for figures from March of 2021, and a massive 30% when compared to figures from March of 2020. On a year-on-year basis, while retail of three-wheelers and commercial vehicles saw an uptick, the major concern is coming in from the two-wheeler, passenger vehicle and tractor segment.
| Category | March '22 | March '21 | YoY % | March '20 | % Change, March '20 |
| 2W | 11,57,681 | 12,06,191 | -4.02% | 18,47,314 | -37.33% |
| 3W | 48,284 | 38,135 | 26.61% | 77,184 | -37.44% |
| PV | 2,71,358 | 2,85,240 | -4.87% | 2,18,076 | 24.43% |
| Tractors | 63,920 | 69,602 | -8.16% | 53,477 | 19.53% |
| CV | 77,938 | 67,828 | 14.91% | 1,16,817 | -33.28% |
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In the case of passenger vehicles, demand remains strong but supply constraints are major hurdles. These hurdles are being exacerbated by global factors such as the persisting semiconductor shortage, lockdown in parts of China owing to surge in Covid-19 cases and Russia-Ukraine conflict. As for two-wheelers, the backbone of the automotive industry, the already shoddy showing has become worse still. FADA President Vinkesh Gulati has urged manufacturers of two-wheelers to come out with special offers and promotions to inject a fresh lease of life to the segment overall. He further highlights that ‘near term outlook for Indian Auto Industry continues to remain a challenge as the on-going Russia Ukraine war and China lockdown does not hint towards a smooth path.’
What could lift sales - and spirits, however is the marraige season, festivities and re-opening of educational institutions and offices, notes FADA. Even still, while pent up demand could auger well, supply remains under a grey cloud.
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