April auto sales: 27% on-year growth in vehicle sales, PV sales pick up 16%, says FADA

Auto sales saw a growth of 27 per cent on-year in the month of April, while the combined March-April period saw a growth of 14 per cent on year, as per the latest Federation of Automobile Dealers Association (FADA). Moreover all the segments saw a positive growth.

According to FADA, two-wheeler sales picked up 33 per cent on-year, while three-wheeler sales increased 9 per cent on-year. Tractors also grew 1 per cent YoY and commercial vehicles experienced a modest growth of 2 per cent on year. 

Meanwhile, the passenger vehicle (PV) segment achieved a 16 per cent on-year growth. 
 
“While some attribute this growth to the shift in Navratri to April instead of March last year, the overall increase was significant,” said FADA President Manish Raj Singhania. 

APRIL AUTO SALES

According to Singhania the growth in PV category was supported by enhanced model availability and favourable market sentiments around festivals like Navratri and Gudi Padwa. “Despite strong bookings and customer flow, high competition, excess supply and discounting presented challenges for sustained growth. Additionally, the lack of new models in some portfolios impacted market traction,” he added.

Singhania said that the 2W segment growth was due to improved supply and the increasing demand for 125cc models. “Positive market sentiments, bolstered by stable fuel prices, a favourable monsoon outlook, festive demand and the marriage season, contributed to this rise. New model launches also helped drive growth, despite some delays in supply,” he said. 

When it comes to commercial vehicles, the category saw a 2 per cent on-year growth but a 0.6 per cent on-month decline, indicating shifting market conditions. “Positive momentum was found in bulk and corporate deals and school bus demand, though elections dampened sentiment, with customers delaying expansion plans. Limited finance options and regional challenges such as water scarcity further impacted performance,” said Singhania. 

NEAR-TERM OUTLOOK 

FADA stated that the May 2024 outlook is shaped by several positive indicators including improved vehicle supply and strategic in the two-wheeler segment. New model launches in the PV section, and favourable monsoon forecasts are set to stimulate customer interest. Bulk deals in the CV segment would also bolster demand in sectors like iron ore, steel, and cement. Further momentum is expected to be provided by the appeal of new electric models and sustained demand for conventional vehicles. 

“Despite these positive trends, challenges remain. Election uncertainty continues to affect market sentiment, delaying customer conversions and stalling purchasing decisions. Financial constraints, extreme temperatures, and overcapacity in the CV segment could slow growth, while heavy discounting in the PV segment could impact profitability. Seasonal factors such as no marriage dates and a lack of major festive events may also influence demand,” said FADA. 

The federation said it is “cautiously optimistic about its near-term outlook”.