Sales of vehicles also remained in the red due to the Shraddh period, considered inauspicious for big purchases
Also, manufacturers did not push much inventory to the dealers expecting sales to remain tepid during the month
New Delhi: Retail or showroom sales of passenger vehicles in India declined a sharp 20% year-on-year to 157,972 units in September, according to data released by Federation of Automobile Dealers Associations (FADA). Customers stayed away from showrooms during festivals like Onam and Ganesh Chaturthi in the southern and western states of the country expecting a cut in Goods and Services Tax on vehicles.
Sales of vehicles also remained in the red due to the Shraddh period during the month, considered inauspicious for big purchases in the northern and western states.
Also, manufacturers did not push much inventory to the dealers expecting sales to remain tepid during the month. Wholesale dispatches of passenger vehicles slumped 23.7% year-on-year to 223,317 units in September, the eleventh straight month of such decline.
Reflecting the slowdown in the rural markets due to a fall in farm income and floods in states like Maharashtra, Bihar, Assam and others, retail sales of two wheelers also decreased 12% year-on-year to 1098271 units.
In the commercial vehicle segment, showrooms sales declined by 18.5% year on year to 63518 units, on the back of slowdown in overall economic activity especially in the manufacturing and infrastructure sector. Increased load carrying capacity of trucks also restricted fleet owners from buying new vehicles.
According to Ashish Harsharaj Kale, president, Fada, continued heavy monsoons in major states and the Shraddh period also contributed to this sales lag. The complete effects of the positive measures announced by the union government were still not visible at the retail levels during September.
“FADA believed September to be a transition month into positivity with continued monsoon and measure after measures being announced by the Government. The retails were under pressure during the month and the decline was on expected lines. The corporate tax cut although not a direct positive for auto retails, but hopefully the savings by corporates will result in higher outflow in promotional offers and marketing spends, which will result in some positivity in the market," added Kale.