After the festive boost, passenger vehicle sales hit the skids in November

PV sales contracted 7.6% year-on-year, with registrations dropping to 400,746 units in November from 433,677 units a year ago, showed the data. 

"Weak demand conditions continue, with high discounts persisting even after the festive season sales and inventory reduction," noted a recent Nomura report about the PV segment.

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This decline represents a dramatic shift from October's peak of 560,823 units —the highest in at least four years—when festive season-driven deep discounts temporarily bolstered the already moderating PV sales. The 42-day festive season, as observed by the Federation of Automobile Dealers Associations (FADA), showed an impressive 7% growth in the PV segment. 

A month-wise analysis of car sales shows that five out of 11 months in 2024—March, June, August, September and November—registered year-on-year contraction. This downturn is a continuation of an already tepid performance in the Indian PV market during the first half of 2024-25. 

According to the Society of Indian Automobile Manufacturers (Siam), PV sales grew by a mere 0.5% between April and September 2024, falling significantly short of the projected 3-4% growth.

The full-year comparison paints a clearer picture of the segment's slowdown. An analysis of the January-November period shows PV sales moderated to a 5% growth in 2024 compared to the same period last year—a marked slowdown from the robust growth of 14% and 11% recorded during the same periods in 2022 and 2023, respectively.

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Indian automakers witnessed a steep decline in November sales as demand weakness overshadowed the festive season boost. 

The market leader, Maruti Suzuki India Ltd, recorded a substantial 16% year-on-year decline in November, with sales dropping to 129,939 units from 153,368 units a year ago. Other major players in the segment, including Hyundai Motor India, Tata Motors and Kia India, also experienced contractions.

Even Mahindra & Mahindra, which had posted an impressive 62% on-year surge in PV sales during October and has been dominating the sports utility vehicle (SUV) market throughout 2024, managed only a modest 2% growth in November 2024.

The segment’s struggles are highlighted by the fact that four out of six leading manufacturers have recorded average sales contractions over the past four months.

While PV sales continue to falter and the full-year performance for 2024 appears subdued, the two-wheeler segment presents a notably brighter picture, showing marked improvement compared to the segment’s performance in the previous two years.

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With the exception of September, two-wheeler sales have consistently posted on-year growth throughout 2024, achieving double-digit increases in six out of 11 months. The segment continued its upward trend, posting a strong 16% growth in November 2024 compared to the previous year. While this represents a moderation from October's exceptional 37% growth during the festive season, it still demonstrates impressive strength.

A recent Axis Securities report attributed this sustained growth to multiple factors, including pent-up rural demand and the introduction of new models.

As India's automotive sector moves into 2025, the contrasting performances of PVs and two-wheelers raise questions about changing consumer demand and purchasing power. The segment’s ability to balance inventory management while navigating emission norms and technology transitions will be crucial in determining whether it can return to desirable growth levels.

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