Passenger vehicle retails sales in India slid 10 per cent on-year in January 2022, as the automakers continued to bear production loss in view of semiconductor shortage, Federation of Automobile Dealers Associations of India (FADA) said on Monday.
The automobile dealers' body, which represents over 15,000 automobile dealers having 26,500 dealerships, further stated that the passenger vehicle (PV) sales declined to 2,58,329 units last month, a dip of 10.12 per cent from 2,87,424 units in January 2021.
It added that two-wheeler sales last month fell by 13.44 per cent to 10,17,785 units, as against 11,75,832 units in January 2021.
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Commenting on the decline, FADA President Vinkesh Gulati said in a statement, "In spite of good demand, passenger vehicles continue to face the brunt of semiconductor shortage, resulting in the absence of a healthy inventory."
Gulati further noted that rural distress coupled with price rise and omicron wave led to a drop in the sales in the segment. Tractor sales stood at 55,421 units last month, down 9.86 per cent from 61,485 units in January 2021.
Commercial vehicle sales, however, witnessed a growth of 20.52 per cent last month at 67,763 units, as against 56,227 units in the year-ago month.
''With the revival in the economy, the commercial vehicle segment continues to show year-on-year growth, especially in the HCV category. With increased infrastructure spending by the central as well as state governments, the overall CV segment remains in momentum,'' Gulati noted.
Three-wheeler retail sales also grew by 29.8 per cent to 40,449 units in January 2022 as compared to 31,162 units a year ago. The total sales across categories last month declined by 10.69 per cent to 14,39,747 units from 16,12,130 units in January 2021.
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Gulati noted that with the Omicron wave getting weak, the retail sales are going to slowly turn positive. ''Semiconductor shortage is also showing some signs of easing as many PV OEMs assure of better dispatch. We hence expect vehicle availability to improve going further,'' he noted.
Gulati stated that with the Union Budget stressing on developing 25,000 kms of new highways, it will further push infrastructure spending, thus, increasing commercial vehicle sales. ''Rural India has generally been a key driver for the two-wheeler and entry-level passenger vehicle segment. With the government's plan for 2.3 lakh crore direct payment as MSP to farmers, it may work as a booster for two-wheelers, tractor and entry-level PV sales,'' he added.
The upcoming marriage season will also trigger some demand revival for the two-wheeler segment, Gulati noted. 'Overall, FADA changes its outlook from 'negative - neutral' to 'neutral' for the next couple of months,'' he stated.
Federation of Automobile Dealers Associations (FADA) said it has collected data from 1,386 out of 1,597 RTOs across the country.
(With inputs from PTI.)