Vehicle supply demand is a major concern post Covid-impact: All India Vehicle Retail Data

Auto Dealers are facing the most challenging phase of their business career as Covid-19 after-effect continues to play spoil-sport.

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All India vehicle retail data for August 21
Image Source: By Newsblare

The Federation of Automobile Dealers Associations (FADA) today shared Vehicle Retail Data for August’21.

Auto Dealers are facing the most challenging phase of their business career as Covid-19 after-effect continues to play spoil-sport. While until last year, when demand was a challenge, supply is becoming a bigger problem currently due to shortage of semi-conductors, even though there is high demand for passenger vehicles.

Every dealer by now starts planning for a bigger offtake in anticipation of a bumper festive but due to supply issues, inventory levels are at lowest levels during this Financial Year.

The 2W market is highly price sensitive. With multiple price hikes, increased fuel cost coupled with Educational Institutions remaining closed, the impact could be felt on the overall segment. Customers continued to fight financial battle due to Covid related health issues and hence remained away from dealerships resulting in low enquiry and lower sales. This has its impact on the entry level segment which continues to face the biggest brunt.

CV segment continues to witness some recovery coming back majorly due to low base of last year. While SCV’s had already shown good recovery due to intra city goods movement, M&HCVs are picking up pace only in specific geographies where the Government is rolling out infrastructure projects. Acquisition cost post BS-6 implementation along with financers keeping away from the segment and high fuel cost continues to restrict recovery in CV demand.” 

Near Term Outlook

With OEMs drastically cutting down productions due to unavailability of semi-conductors & ABS chips, shortage of containers and high metal prices, customers for the first time may not get a vehicle of their choice and lucrative schemes during this festive season. Ultra-frequent price increase is also keeping entry level buyers at bay.

Customers especially at the bottom of the pyramid are shifting their priority from saving instead of spending. This will hence keep demand for 2-wheelers a concern. Though, with Educational Institutions slowly opening up, a ray of hope can be seen for an improved demand in 2-Wheeler category in coming months.

FADA thus sees that the near term outlook will continue to remain a mixed bag with PVs witnessing demand-supply mis-match and 2W facing a demand crunch.

  • Inventory at the end of July’21
    • Average inventory for Passenger Vehicles ranges from 25-30 days
    • Average inventory for Two – Wheelers ranges from 20-25 days
  • Liquidity
    • 40.6% Dealers rated it as neutral
    • 37.8% Dealers rated it as good
    • 21.7% Dealers rated it as bad
  • Upcoming Festive Season
    • 44.9% Dealers rated it as Good
    • 40.4% Dealers rated it as Neutral
    • 14.6% Dealers rated it as Bad

Chart showing Vehicle Retail Data

All India Vehicle Retail Data for August’21

CATEGORY

AUG’21

AUG’20

YoY %

AUG’19

% Chg, AUG’19

2W

9,76,051

 9,15,126

6.66%

12,61,432

-22.62%

3W

30,410

 16,923

79.70%

55,292

-45.00%

PV

2,53,363

 1,82,651

38.71%

1,92,417

31.67%

TRAC

71,737

 67,999

5.50%

52,757

35.98%

CV

53,150

 26,851

97.94%

62,319

-14.71%

LCV

34,829

 21,520

61.84%

38,029

-8.41%

MCV

2,947

 741

297.71%

3,963

-25.64%

HCV

12,463

 2,365

426.98%

18,013

-30.81%

Others

2,911

 2,225

30.83%

2,314

25.80%

Total

13,84,711

 12,09,550

14.48%

16,24,217

-14.75%

Source: FADA Research

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