Auto retail sales in June demonstrated a 10 per cent YoY growth, encompassing positive performances across all vehicle categories including two-wheelers, three-wheelers, passenger vehicles, tractors and commercial vehicles with respective growth rates of 7 per cent, 75 per cent, 5 per cent, 41 per cent, and 0.5 per cent. But despite a 10 per cent growth in June, auto retail sector has seen an 8 per cent MoM dip, indicating a short-term deceleration in sales.
The passenger vehicle segment faces inventory pressures and demand-supply mismatches, impacting profitability, but the anticipation of a boost from the upcoming festive season beginning, end-August offers a hopeful outlook, FADA observed.
In the passenger vehicle segment, Maruti Suzuki India topped the verticle, with a 41.09 per cent market share. Hyundai Motor India was the second with a 14.59 per cent market share. Tata Motors was the close third with a 13.47 per cent market share.
In May, the auto retail industry saw a robust 10 per cent YoY growth across all vehicle categories due to a resurgence in the 2W, 3W, PV, Tractor, and CV segments with growth rates of 9 per cent, 79 per cent, 4 per cent, 10 per cent, and 7 per cent, respectively.
But despite a slight decline of -3 per cent compared to pre-COVID levels, the overall retail figures relatively improved, except two-wheeler sales (-14 per cent) being the primary segment which continued to experience setback. For the first time, CV came out of the effect of Covid and grew by 1.5 per cent when compared to June 2019.
FADA further added that erratic monsoon in India is raising concerns about yield and potentially impacting automobile sales, especially in rural areas, but the anticipation of evenly spread rains going forward may revive rural demand and thus positively influence retails.
"Despite a 10 per cent YoY growth, auto retail sector has seen an 8 per cent MoM dip, indicating a short-term deceleration in sales. Analysing individual categories on a YoY basis, 2W, 3W, PV, Tractor and CV segments observed growth rates of 7 per cent, 75 per cent, 5 per cent, 41 per cent and 0.5 per cent, respectively. In comparison to pre-COVID levels, the overall auto retail marked a marginal decrease of 3 per cent, with 2W as the sole laggard. Conversely, the CV segment experienced a 1.5 per cent growth compared to June'19, surpassing the pre-COVID levels for the first time," said Manish Raj Singhania, FADA President.
Passenger vehicle sales
In June, the passenger vehicle segment faced a mix of factors. While the launch of new models and the potential rise in rural sales lend optimism, dealers navigated inventory pressures from OEMs and demand-supply mismatches, impacting profitability.
However, the anticipation of a boost from the upcoming festive season in end-August offers a hopeful outlook. The commercial vehicle sector contends with a balance of positive market sentiment and potential monsoon impacts, with demand spurred by infrastructural projects and improved financing options.
"The passenger vehicle segment navigated through a mixed landscape characterized by variable demand, dynamic product portfolios and oscillating market sentiments. FADA commends Maruti's swift action to facilitate the clearance of slow-moving model stockpiles by underwriting dealer interest costs, contributing positively to the segment. With dealers noting sporadic supplies of popular models and aging product concerns of slow-moving variants, the segment still experienced an uptick in demand for new models and anticipates rural sales to pick up further pace," Singhania said.
| PV OEM | June 2023 | Market share | June 2022 market share |
| MARUTI SUZUKI INDIA LTD | 1,21,341 | 41.09% | 40.91% |
| HYUNDAI MOTOR INDIA LTD | 43,079 | 14.59% | 14.14% |
| Tata Motors Ltd | 39,773 | 13.47% | 13.26% |
| MAHINDRA & MAHINDRA LIMITED | 30,053 | 10.18% | 7.43% |
| KIA MOTORS INDIA PVT LTD | 16,749 | 5.67% | 6.63% |
Two-wheeler market
The two-wheeler market anticipated continued supply challenges and economic pressures, despite new schemes and expectations of monsoon-boosted sentiment. Meanwhile, the cutback in FAME subsidies casts a shadow over EV sales. Conversely, the three-wheeler market predicts growth, underpinned by favourable market responses and rising demand.
| Two-wheeler OEM | June 2023 | Market share | June 2022 market share |
| HERO MOTOCORP LTD | 4,26,601 | 32.56% | 34.66% |
| HONDA MOTORCYCLE AND SCOOTER INDIA (P) LTD | 2,82,493 | 21.56% | 23.30% |
| Tata Motors Ltd | 2,26,511 | 17.29% | 14.62% |
| BAJAJ AUTO GROUP | 1,63,176 | 12.45% | 9.43% |
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