Worst festive season in a decade as auto retail sales dip 18% year-on-year: FADA

While the 42-day long festive period in the country starting from Ganesh Chaturthi and ending with Diwali usually means good business for the country's auto industry, the period this year was the worst in a decade. Automobile retail sales fell 18 per cent year-on-year during the period due to the ongoing global semiconductor shortage, FADA said.

The chip crisis affected production of vehicles across OEMs and thus impacted the dispatch to dealers, resulting in lower volumes. During the festive period this year, retail sales of passenger vehicles, two-wheelers and tractors were down as compared with the same period of last year. Total retail sales in the industry across segments stood at 20,90,893 units this festive period as compared to 25,56,335 units in 2020, as per data collated by the Federation of Automobile Dealers Associations (FADA).

Passenger vehicle registrations stood at 3,24,542 units, down 26 per cent from 4,39,564 units in the festive period last year. Entry-level cars saw subdued demand as customers in that category continued to conserve money to due to economic uncertainties.

Two-wheeler sales dropped by 18 per cent to 15,79,642 units as against 19,38,066 units in 2020. Tractor sales dropped 23 per cent to 56,841 units as compared with 73,925 units in the same period of last year. “The two-wheeler category continues to face the brunt of low sales with the entry level category being the biggest spoilsport," FADA President Vinkesh Gulati said.

Sales of three-wheeler, however, increased 53 per cent to 52,802 units as compared with 34,419 units last year. Similarly, commercial vehicle sales rose by 10 per cent to 77,066 units as against 70,361 units in 2020.

Gulati noted that in terms of overall retail sales in the industry, this has been the worst festive season in a decade. "Semiconductor shortage which was already a full blown crisis showed its true colours when in spite of an above healthy demand, we could not cater to customer's need as SUV, compact-SUV and luxury categories witnessed huge shortage of vehicles," Gulati added.

Get insights into Upcoming Cars In India, Electric Vehicles, Upcoming Bikes in India and cutting-edge technology transforming the automotive landscape.