Retail sales of passenger vehicles (PVs) are back in the green after nearly six months, with 9.81 per cent growth in September.
PV sales increased to 195,665 units from 178,189 units in September last year.
Other than PVs, tractors remain the only segment to show growth while all the other segments continue in the red.
Tractor sales rose by 80.39 per cent to 68,564 units from 38,008 units.
Overall retail sales report a 10.24 per cent drop to about 1.34 million units in September as compared to around 1.49 million units a year ago.
With no more lockdowns as announced by the Central government, dealers anticipate high growth during the festival months of October and November.
Two-wheeler sales dropped 12.62 per cent to 1.01 million units from 1.16 million units, while the three-wheeler segment reported a 58.86 per cent fall to 24,060 units as compared to 58,485 units.
Sales of commercial vehicles dropped by 33.65 per cent to 39,600 from 59,683 units, according to the Federation of Automobile Dealers Associations (FADA) numbers.
FADA President Vinkesh Gulati said with the government’s efforts to unlock India, September continued to witness rising automobile registrations.
“Passenger vehicles for the first time (this financial year) saw positive growth on a year-on-year (y-o-y) basis. With social distancing, coupled with the government’s push to further normalise business conditions and banks financing vehicle purchases, entry-level passenger vehicles saw good demand. New launches and vehicle availability played their part as catalysts. A lower base during the last financial year also helped in the rise,” said Gulati.
Tractor sales continued their healthy run as kharif sowing witnessed record progress in the area covered. With a good rabi season resulting in high disposable incomes, there was a knock-on effect in rural markets on sales of two-wheelers, small passenger vehicles, and small commercial vehicles.
Gulati said the economic revival was mostly limited to rural India and the impact of the pandemic was still felt on larger states and urban centres. The top states that make up half of India’s economic output (Maharashtra, Tamil Nadu, Uttar Pradesh, Karnataka, Gujarat and West Bengal) are now showing signs of economic activities.
Mitul Shah, vice-president (research), Reliance Securities, said monthly auto volume registrations by most automobile segments were encouraging with healthy rural sales and a revival in urban markets recently.
Gulati said the government’s waiver of interest on interest during the moratorium (on loans up to Rs 2 crore) would help in improving customer sentiment.
According to FADA, inventories of two-wheelers stand at 45-50 days and PVs at 35-40 days.
FADA has asked original equipment manufacturers and dealers to avoid building further inventories.