FADA Releases June’20Vehicle Registration Data

 

New Delhi: The Federation of Automobile Dealers Associations (FADA) today released the Monthly Vehicle Registration Data for the Month of June’20.June’20Retail Sales Commenting on how June’20performed, FADA President, Mr Ashish Harsharaj Kale said, “Unlock 1.0 coupled with increase in demand from the rural market has boosted the retail sales with respect to the May month’s numbers .At the end of June, Almost 100% dealership outlets (showroom and workshops) were operational across the country, barring a few cities and towns which have once again implemented stringent Lockdown. June registrations, although better than May is still not Indicative of the actual demand situation as Lockdown woes continue in some parts and supply side is far from its complete potential. Overall weak economic sentiments coupled with rising number of Covid-19 patients has led to weak consumer confidence especially in Tier –1 cities, as customers stopover from concluding their purchase as fear of community spread and therefore a return ofcomplete lockdownpersists. Rural market lead by a robust cropsituation of previous harvest and timely arrival of monsoons has witnessed demand recovery in comparison to urban areas, therefore leading surge in retail sales of tractorsas well as positively impacting 2W and Small Commercial Vehicles.The Positive Rural Sentiment if backed with demand boosting measures by the Governmentcan ensure the quickest return to normalcy of the Auto Industry,amongstall Core Industries,thereby impacting the Overall Consumer Sentiment Positively.

•Vehicle Registration for June tumbles by -42% as the Indian Economy continues to battle with Covid-19.

•On a YoY basis, 2-Wheeler degrows by -40.92%, 3-Wheeler by -75.43%, CV by -83.83%, and PV by -38.34%. Tractors registrations continue to march ahead with June numbers showing a growth of 10.86%.

•Ease in Nationwide lockdown (Unlock 1.0) has boosted the number of vehicles registered compared to May last month.

•Robust Demand recovery observed in rural market leading to rise in sales volume of tractors, followed by 2W, small commercial vehicles. However, M&HCV and PV sales particularly in Urban pockets play laggards as Lockdown persists in many Cities.

•Demand boosters from the Government can ensure speedier Auto demand revival. Attractive vehicle scrap page policy is one of the dire needs for revival of CV market.

FADA would once again urge Our Government for urgent introduction of Attractive Incentive based Vehicle Scrap page Policy which today is one of the dire needs for the revival of the Commercial Vehicle Sector and especially M&HCV’s, asthe sector faces major headwinds in demand revival.” Outlook for July With an assumption of no further lockdown and continued reopening measures, it is anticipated that Vehicle Registrations will see somewhat similar trends and mostly will better the June numbers, with further green shoots of demand in newer geographies and segments. Overall Auto demand though continues to be a challenge coupled with supply side constraints as well Constraints in Retail Lending from NBFC’s, normalcy in demand still seems quite distant and not before the festive season. Despite the positive trends in the rural markets, the AnnualOutlook currently continues to be grim with projected sales to witnessa de-growth range of 15%-35% across various segments in FY21,except for the Tractor segment, which looks set to clock a positive annual growth.

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