Passenger vehicle (PV) retail sales in India declined by 4.53 per cent in August to 3,09,053 units owing to the impact of excess rainfall.
The sale was 3,23,720 units during the same month in 2023, according to the Federation of Automobile Dealers Associations (FADA).
Inventory levels also reached historic highs, with stock days now stretching to 70-75 days and inventory totalling 780,000 vehicles, valued at an alarming Rs 77,800 crore, it said.
Similarly, tractor and commercial vehicle (CV) sales dropped by 11.39 per cent and 6.05 per cent, respectively.
The two-wheeler (2W) and three-wheeler (3W) segments managed to post growth of 6.28 per cent and 1.63 per cent, respectively.
In total, India’s automobile retail market registered a modest year-on-year growth of just 2.88 per cent in August, Fada said.
The two-wheeler market saw a month-on-month decline of 7.29 per cent , largely due to excessive rains and flooding, which disrupted demand across various regions.
However, despite these challenges, the two-wheeler segment grew by 6.28 per cent year-on-year. The gap between market leaders Hero Motocorp (3,58,616 units) and Honda Motorcycle and Scooter India (3,52,605 units) was marginal, with a market share of 26.8 per cent and 26.35 per cent respectively, the data said.
In August, India witnessed 15.9 per cent excess rainfall across the country, with northwest India seeing a surplus of 31.4 per cent , 7.2 per cent in the east and northeast, 17.2 per cent in central India, and a minor deficiency of 1.3 per cent in the peninsular region.
This monsoon season brought unpredictable weather, starting with extreme heat waves that delayed the monsoon and transitioned into heavy rainfall, leading to flood-like conditions in several areas.
“Excess rainfall has affected enthusiasm in the rural market, resulting in a drop in sales, mainly in two-wheelers. We expect an overall 6 per cent rise in auto retail sales for the entire year,” said Manish Raj Singhania, president, FADA.
“Many customers postponed their purchases, anticipating new product launches, while others deferred due to market saturation and changing preferences. Limited marketing efforts from original equipment manufacturers (OEMs) and subdued market sentiment further impacted sales,” he added.
The data further said that the commercial vehicle sales experienced a sharp drop, with an 8.5 per cent month-on-month decline and a 6.05 per cent year-on-year fall. CV sales for the month stood at 73,253 units, compared to 77,967 units in August 2023.