India's auto sales rose 29.3% in November
All segments except for tractors saw positive growth amidst festivities.
Despite muted celebrations due to the pandemic, India’s automobile retail sales recorded a 29.3% MoM growth in November amidst the main festivities Dhanteras and Diwali, as well as the onset of the wedding season in the country, according to a report from CARE Ratings.
Except tractors, all segments of automobiles witnessed positive growth, with two-wheelers and passenger vehicles performing the best with 35.7% and 16.5% growth, respectively. New model launches and premiumisation helped clock positive growth for these two segments.
Amidst a gradual rise in infrastructural activities and growth in the e-commerce sector, the retail sales of commercial vehicles rose 12.7%. However, demand for buses remain muted as most schools remain closed and a large number of offices still encourage work from home practice.
Further, the medium and heavy commercial vehicle (M&HCV) segment continue to grapple with inflated prices of BS-6 models.
On the other hand, tractor sales declined, with the three-wheelers segment, though showing some positive growth sequentially, showing the weakest performance amongst automobiles in FY 2021 to date.
On a YoY basis, retail sales of automobiles are at nearly 80% of last year’s levels, which reflects an impressive recovery of the sector in a pandemic year, the report noted. All segments, except for passenger vehicles and tractors, reported negative growth during the month.
“Reaching pre-covid levels of sales seems improbable in FY21, as consumer demand for automobiles is expected to stagnate in Q4-FY21. The festive season has nearly ended and hence, near term demand for automobiles will depend on how quickly the economy progresses and lifts consumer incomes,” CARE Rating said.