[vc_row][vc_column][vc_column_text css=”.vc_custom_1678338654303{border-top-width: 1px !important;border-right-width: 1px !important;border-bottom-width: 1px !important;border-left-width: 1px !important;border-left-color: #000000 !important;border-left-style: solid !important;border-right-color: #000000 !important;border-right-style: solid !important;border-top-color: #000000 !important;border-top-style: solid !important;border-bottom-color: #000000 !important;border-bottom-style: solid !important;border-radius: 3px !important;}”]

Vehicle Sales Data – February ’23

[/vc_column_text][vc_separator css=”.vc_custom_1647339034936{margin-bottom: 30px !important;}”][vc_column_text css=”.vc_custom_1678342091089{margin-bottom: 15px !important;}”]Federation of Automobile Dealers Association published vehicle retail sales data for the month of February 2023. On YoY basis, total vehicle retail for Feb’23 grew by 16%, however, on a monthly basis, total volumes contracted about 3%. While the 2-Wheeler segment showed growth on YoY basis, it is yet to recover and reach pre-pandemic levels. The 3-Wheeler  segment for the first-time breached pre-pandemic level of Feb’20 as it grew by 3.3% when compared to Feb’20. Passenger Vehicle category continues to hold on to its growth despite rural market which is yet to see full recovery. Bharat tightening its belt due to inflation adds as a key risk for rise in automobile sales The US government weather agency, National Oceanic and Atmospheric Administration, in its forecast earlier this month had predicted that El Niño could return as early as June, when the southwest monsoon sets over the Kerala coast. This may act as a threat to normal monsoon and thus impact Automobile sales going ahead.

Commenting on how February’23 performed, FADA President, Mr. Manish Raj Singhania said, “February’23 continued to witness double digit growth of 16% YoY but was still down by -8%, when compared to pre-covid month of February’20. All categories also witnessed double digit growth. The 2-Wheeler category witnessed a growth of 15% YoY but was down by -14% when compared to precovid month of February’20. On the overall, high inflation and poor sentiment has kept the customers at bay. The 3-Wheeler segment has seen 81% growth YoY and has also grown by 3% when compared to precovid month of February’20. This category has seen a drastic growth due to Central and State Government’s subsidy along with good scheme promotion done by the states. Along with this, aggressive finance schemes continues to aid growth for this category. The Passenger Vehicle segment saw a growth of 11% YoY and 16% when compared to pre-covid month of February’20. Launch of new models, continuously improving supply coupled with healthy booking to cancellation ratio and wedding bells kept the momentum going for this already well to do segment. The Commercial Vehicle category has also shown robust growth by growing 17% YoY though it fell by 10% when compared to pre-covid month of February’20. Walk-in enquiries improved during the month. Apart from this, demand has also increased due to change in OBD norms which will see price hikes. On the Government’s side, infrastructure spending has been healthy. This is also aiding better sales.”[/vc_column_text][vc_single_image image=”72895″ img_size=”large” alignment=”center” css=”.vc_custom_1678340773796{margin-top: 20px !important;margin-bottom: 20px !important;}”][vc_column_text css=”.vc_custom_1678341395900{margin-bottom: 15px !important;}”]The graph above shows the one year trend of sales data, taking February 2022 numbers as the base. The best performing segment over the past year has been the three wheeler segment. Commercial vehicle segment has remained stable throughout the year. Two-wheeler segment has shown a lot of variability over the year and is seeing demand falling on the back of growing inflation. Passenger vehicle data too has remained more or less stable over the year with a slight positive trend.

Starting with passenger vehicles in the listed space, Maruti Suzuki sold 20% less vehicles since last month, and both, Tata Motors and Mahindra and Mahindra, sold about 13% lesser than last month. Maruti Suzuki has also seen its pre-pandemic market share of 47% fall to 41% in current times. On the other hand, both Tata Motors and M&M have increased their market share by 5% each, with a combined share of 20% currently.

Listed companies in the two wheeler space shared muted to slightly positive sales month on month, with Hero Moto Corp leading the sales data, however, losing the maximum in terms of share price. TVS Motors, on the other hand, grew monthly sales marginally, and saw a 4% increase in share price in February 2023.

Sales for commercial vehicles and tractors also had a dismal month on month performance and the same can be reflected in the share prices of Escorts Kubota, VST Tillers, Ashok Leyland and other bigger groups. Below is a snapshot of the entire listed space.[/vc_column_text][vc_single_image image=”72896″ img_size=”large” alignment=”center” css=”.vc_custom_1678340799054{margin-top: 20px !important;margin-bottom: 20px !important;}”][vc_column_text css=”.vc_custom_1678340029881{margin-bottom: 15px !important;}”]The month of march has multiple festivals like Holi, Ugadi, Gudi Padwa, Navratri etc. This will help push auto sales. Apart from this, better availability of vehicles, last month of the Financial Year, change in OBD norms from April which will increase vehicle prices, the industry may see schemes being rolled out by the OEMs thus aiding higher sales. On the flipside, India’s chief economic advisor said that urban demand recovery is taking place at a faster pace then rural. This along with sharp slowdown in private consumption expenditure to a 2-year low suggests a softening in household spending demand amid inflationary pressure as post covid pent-up demand starts to fade. Apart from this, the Finance Ministry has released a statement that the predictions of a return of El Niño conditions in the Pacific could presage a weaker monsoon in India, resulting in lower output and higher prices. This will act as a dampener for Auto sales. While the month of March looks good for Auto Sales, on a medium-term outlook, FADA remains cautious till the time a better monsoon forecast is not announced by IMD.[/vc_column_text][vc_zigzag][vc_column_text]

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