Declining Vehicle Sales Reflect Sluggish Consumer Demand

New Delhi: Retails sales of passenger vehicles along with two-wheelers, three-wheelers, tractors, and commercial vehicles in India decreased 4.31% year-on-year in July to 1.96 million units, on a high base, and reflected a sluggish consumer demand.

While sales of commercial vehicle sales remained flat, retail sales of both passenger vehicles and two-wheelers decreased during the month, with the only exception being an increase in tractor sales, owing to a good monsoon and crop sowing, reported Economic Times.

According to data compiled by Federation of Automobile Dealers' Associations (FADA) which is a dealers’ lobby group, around two million vehicles across categories were registered in July 24. The data was collected by the FADA from the VAHAN portal of the Ministry of Road, Transport and Highways (MoRTH).

The data indicates that while two-wheeler sales went down 6.5% on-year to 1.36 million units in July this year, sales of passenger vehicles decreased by around 1% to 328,613 units.

Commercial vehicle sales largely remained flat at 76,439 units last month, while three-wheelers grew 0.8% to 111,426 units, the ET report said.

"After three consecutive months of growth, India's auto retail sector applied the brakes in July, with overall retails declining by 4.31% YoY. This pullback largely stems from a high-base effect in July 2024, when an extreme heat wave was immediately followed by excessive rainfall, constraining volumes before a rebound later that month," C.S. Vigneshwar, president, FADA told ET.

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