Retail sales of vehicles in India scaled up 16 percet to 1.8 million units in February 2023, due to strong demand during the wedding season, an industry body of automobile dealers said on March 6, 2023. It said that festivals could push the sales higher in March, 2023.
As chip shortages eased and automakers introduced new models to meet demand ahead of the festival and wedding seasons, sales increased over the past two months. However, rising interest rates amid elevated inflation are witnessed as a sentiment dampener, with overall sales in February 2023, still below pre-Covid levels.
According to a statement from The Federation of Automobile Dealers Associations (FADA), sales of two-wheelers increased by 15%, three-wheeler sales increased by 81%, passenger car sales increased by 11%, tractors increased by 14%, and commercial vehicle sales increased by 17%.
The introduction of promotional offers by automakers in the last month of the fiscal year and changes to emission standards beginning in April 2023 could boost sales in March 2023, according to FADA.
The industry group listed a number of celebrations as the reason for the demand in March 2023, including the two-day festival of colours known as Holi and local new year celebrations Ugadi and Gudi Padwa.
Whereas the Society of Indian Automobile Manufacturers (SIAM), which typically releases data in the second week of the month, counts automobiles delivered to dealers, FADA publishes data on retail sales.
Car sales figures are closely monitored because they are one of the most important measures of private spending and account for more than 50% of the country's economic development.
The industry group also cautioned that forecasts for a return of El Nio weather conditions in the Pacific could weaken India's monsoon, resulting in lower output and higher pricing, which could hurt sales of commercial vehicles.
As chip supply difficulties subsided in February 2023, two of India's top three publicly traded bike manufacturers, TVS Motor Company and Hero MotoCorp, outperformed expectations for domestic sales.
The 3-wheeler sector continued to see robust demand after the government subsidies breached pre-pandemic levels for the first time in February 2023, FADA added.
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