Auto retail sales up 10 percent in July 2023: Three-wheelers record highest growth

The Federation of Automobile Dealers Association (FADA) recently released the Vehicle Retail Data for July 2023. Auto retail sales witnessed a YOY growth of 10 percent last month, however, the overall retail sales declined by 5 percent on an MoM basis.

Vehicle segments, such as Two-wheelers, Three-wheelers, Passenger Vehicles, Tractors and Commerical Vehicles witnessed a Year-on-Year (YoY) growth of 8%, 74%, 4%, 21%, and 2% respectively. The three-wheeler segment record the highest growth of 74% YoY with 94,148 unit sales in July 2023 and an MoM increase of 9 percent.

On MoM basis, except 3W's 9% growth, other segments declined. Compared to pre-COVID figures, auto retail decreased by -13%, with significant drops in 2W and CV at -23% and -4%.

The two-wheeler, PV and Tractor sales witnessed a negative monthly sales decline of 6 percent, 4 percent and 8 percent, respectively. Commerical vehicles registered a marginal decline of 0.2 percent on monthly basis.

Manish Raj Singhania, FADA President said, "Auto retail grew 10% YoY in July, mirroring last month's trend. However, the MoM decline continued highlighting short-term slowdowns. On a YoY basis, segments like 2W, 3W, PV, Tractor, and CV grew at rates of 8%, 74%, 4%, 21%, and 2%."


Near term outlook
The 2W sector expects an uptick, driven by upcoming festivals, a harmonious supply-demand equilibrium and the rollout of new models. The 3W category, too, is witnessing a surge in interest, particularly towards electric variants.

In the realm of CV, the anticipation of the festive season, the aftermath of a good monsoon and pent-up demand set the stage for potential growth. Similarly, the PV segment is likely to benefit from festive euphoria and new product introductions coupled with high demand in the SUV category.

However, the 2W segment's entry-level category continues to be a cause for concern. In the CV space, there are apprehensions regarding streamlined loan disbursements for buyers. Inventory level in PV has breached 50 days mark in anticipation of upcoming festival season and the slowdown in entry level car remains.

While the industry has experienced a tepid trend over the past two months, FADA remains hopeful about a rise in retails as the festive season is on the horizon.Discover everything about the automotive world at Times of India.