The Federation of Automobile Dealers Associations (FADA), apex national body representing automobile dealers in India, said that total vehicle registrations in October 2020 declined 23.99% to 14,13,549 units from 18,59,709 units in October 2019.
Two-wheeler vehicle registrations were at 10,41,682 vehicles (down 26.82% YoY), three-wheeler vehicle registrations were at 22,381 vehicles (down 64.50% YoY), commercial vehicle registrations were at 44,480 vehicles (down 30.32% YoY) and the registrations of passenger vehicles stood at 2,49,860 vehicles (down 8.80% YoY) in October 2020.
Tractor registrations, however, jumped 55.53% to 55,146 units in October 2020 from 35,456 units in October 2019.
The total vehicle registrations in October 2020 grew by 5.11% over September 2020.
FADA President, Vinkesh Gulati said, "October continues to see positive momentum on monthly basis but on a yearly basis the negative slide continues to increase. The 9 days Navratri period witnessed robust vehicle registrations but could not save October to go in red as compared to last year when both Navratri and Diwali were in the same month.
While new launches continued to be in demand in Passenger Vehicle segment, entry level motorcycles witnessed a lean demand in 2-Wheeler segment. With supply side mismatch, most of the passenger vehicle dealers ended with limited stock of high selling items and odd variants which did not attract much demand. This coupled with lower discounts, compared to last festivals also played a spoilsport.
While Small Commercial Vehicles are seeing robust demand due to local goods transportation back to pre-COVID levels, the medium and heavy commercial vehicles segment continued to bleed. FADA urges the Government to urgently announce an attractive incentive based Scrappage Policy. It also requests the Government to release funds for infrastructure projects which it has awarded as this will help demand generation and will lead to higher production of vehicles.
The Government's continued procurement of Kharif crops at MSP from farmers is leading to a higher disposable income in rural India. This continues to show robust demand in Tractor segment which grew at a healthy 55% YoY."
On the near term outlook, FADA said: "As we enter the last leg of festivals and with COVID getting into its 3rd wave in many cities, there is a sense of cautiousness amongst customers. Due to the lockdown announced in few European Countries, procurement of spares will also be a cause of hinderance for smooth supply of vehicles in Indian markets. This will create a supply and demand mismatch thus affecting the passenger vehicle sales.
FADA once again cautions both OEMs and Dealers to keep a check on vehicle inventory as post festivals, demand may remain subdued. Since Inventory levels are at its highest during this Financial Year, it may impact Dealers financial health thus leading closures and job losses."
Meanwhile, the Nifty Auto index rose 0.60% to 8,054.30 while the benchmark Nifty 50 index added 1.44% to 12,440.75.
Bharat Forge (up 3.50%), Eicher Motors (up 1.91%), Tata Motors (up 1.44%), Bajaj Auto (up 0.89%), Hero MotoCorp (up 0.22%) and Mahindra & Mahindra (up 0.16%) advanced.
Concurrently, Ashok Leyland (down 1.06%) and Maruti Suzuki India (down 0.46%) declined.
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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
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