Auto Sales Soar In Sept, Rural India Remains A Concern

Mobility Outlook Bureau
16 Oct 2023
03:02 PM
1 Min Read

SIAM data shows that entry-level cars and two-wheelers are seeing little traction in rural India with SUVs firing on all cylinders.


Auto sales continued to grow in September at 1.6% YoY across all segments, according to data released by the Society of Indian Automobile Manufacturers (SIAM) on October 16.

Vinod Aggarwal, President, said this a result of economic growth and conducive government policies. While the semiconductor shortage crisis was a thing of the past, the sluggish growth in income levels of rural India was an area of concern which was hitting sales in the entry level segment of two-wheelers and cars.

In the case of the former, while September sales at 1.75 million units grew 0.87% from the corresponding month last year, the second quarter tally was down 1.6% YoY to 4.6 million units. The drop in the entry-level (110cc) motorcycle segment has been 39% YoY while 125cc scooters have fallen 25%.

Weak sentiment in rural India has also hit cars with compact cars less than 3.6 metres long  seeing a huge 75% YoY drop in sales. However, Aggarwal said this could also be due to changing customer preferences for larger vehicles. Despite this grim backdrop, PV sales in September were up 1.87% to 361,717 units and 4.6% in Q2 to 1.07 million units.

Rajesh Menon, Director General, SIAM, said while the entry-level segment was in free fall mode, utility vehicles were driving growth of PVs and constituted nearly 60% of total retails in Q2. PV sales also crossed the two million domestic sales mark for the first time in the first half of the fiscal.

3W Sales Soar

Three-wheelers have been the real growth drivers by the end of the day with sales increasing by 46.9% YoY to 74,418 units in September. Q2 domestic retails number stood at 195,215 units translating into 62.2% YoY growth. Aggarwal said pent-up demand was playing a big role in the three-wheeler space.

Commercial vehicles have also been doing well with sales up 6.8% YoY in Q2 to 247,929 units. Medium and heavy trucks/buses have led the way with 17.5% growth at 93,796 units.

As for exports, September saw a rise of 3.34% to 391,717 units though the Q2 table dropped by 6.02% to 1.18 million units.

Passenger vehicles were the winners in exports with September seeing a 17.28% jump to 60,079 units while the quarter was up 15% to 1.84 lakh units. Aggarwal said lack of forex was the main reason which had hit two-wheeler shipments to the extent of 6.4% at 8.94 lakh units in Q2. September, though, was up 2.4% to 3.02 lakh units.

Three-wheeler exports in September fell 10.9% to 29,052 units and 28.8% to 81,794 units in the quarter. The CV segment also saw a drop of 23.9% to 17,239 units in exports.

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