Retail car sales on slow lane in November, skid 19 per cent

NEW DELHI: Retail sales of passenger vehicles (PVs) fell 19% in November 2021 to 2,40,234 units as against 2,98,213 units sold in the same month last year as chip shortage continue to play a spoiler, according to data issued by auto dealer body Fada.

Large Indian automakers such as Maruti Suzuki and Hyundai are producing PVs at much lower quantity than their installed capacity as they are unable to outsource vital electric components, mainly the semi-conductor.

“PV continues to face the brunt of semi-conductor shortage. While the new launches are keeping customer’s interest high, it is only the lack of supply which is not allowing sales to conclude. The extended waiting period is now starting to make customers jittery and this may lead to loss of interest in vehicle buying,” said Vinkesh Gulati, president at the Federation of Automobile Dealers Associations (FADA).

Two-wheeler sales also registered a decline in demand despite having an eventful month of festive and marriage season. It fell 1% year-on-year in November 2021 to 14,33,855 units.

“While the 2W segment saw almost at par sales compared to last year (which itself was a bad year), overall sentiment remained low as marriage season also didn’t help in revival except in one or two states. Apart from this, crop loss due to incessant rains and flood in southern states, high acquisition price as well as fuel costs kept the customers away. Further, there are no signs of increase in inquiry levels which is a bigger cause of concern,” said Gulati.

To note, Hero MotoCorp and Honda 2Wheelers, India’s two biggest players in this segment, had reported abysmal numbers for the month of November.

On the near term outlook, Fada said that the new variant of Covid ‘Omicron’ has once again gripped the entire nation in fear.

This will further impact the overall vehicle demand. Price rise due to high input costs and high fuel costs are continuing to add customers’ woes.