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‘Retail auto sales slip 28% over March; May to see muted run’


With almost all the States resorting to either a partial or a full lockdown amid the second wave of the pandemic, total retail vehicle registrations declined 28% to about 11.85 lakh units in the last month compared with March, the Federation of Automobile Dealers Associations (FADA) said on Monday.

For the full year ended March 31, vehicle sales fell almost 30% to 1.52 crore units. Annual vehicle registrations were below FY13 levels, that is, their lowest in eight years.

The automotive dealers’ body added that the second wave of COVID-19 has not only hit urban markets but also unsettled the rural segment, which was relatively insulated the first time around. Hence, recovery is expected to take longer than that following the first wave. As per FADA’s data, retail sales of passenger vehicles (PVs) declined 25.3% month-on-month to 2.79 lakh units, while two-wheeler sales fell 27.6% to about 11.95 lakh units. Commercial vehicles fell 23.7% to 67,372 units. Sales of tractors also declined 44.6% to 69,082 units.

All comparisons have been made month-on-month as April 2020 saw zero registrations due to the nationwide lockdown.

For the year ended March, all vehicle segments witnessed a decline, except for tractors, which grew 16.1% to 6.44 lakh units. PVs fell almost 14% to 23.86 lakh units, two-wheelers slipped 31.5% to 1.15 crore units, commercial vehicles declined 49% to 4.48 lakh units and three-wheeler sales fell 64% to 2.58 lakh units. FADA said the first nine days of May had seen ‘extremely lean’ sales due to lockdowns in a majority of the States. Even where dealerships were open, walk-ins had dropped to 30% and buyers were delaying decisions.

The apex entity expects May to remain “sluggish”.

On the long-term sales outlook, it expects recovery to be slower than after the first wave due to the impact of the pandemic on the rural markets as well this time. “The only ray of hope lies on monsoon’s on time arrival…The country’s weather office has also said that India is expected to get average monsoon rains this year, thus raising expectations of higher farm output, which is central to the country’s economy. This will also lead to rural markets recovering faster than urban,” it said.

The industry body added that recovery from the lows of FY21, to reach the highs of FY19, is expected only by FY23.

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