Workplace mobility, retail demand growth uninspiring

In continuation to our mobility series, we are monitoring the global mobility and retail demand trends as we believe both these data points are highly correlated. Key takeaways for Oct’20: a) mobility data trends are softening MoM globally driven by Europe (charts 7-10,) India is also witnessing similar trends in some states (e.g. Jharkhand, West Bengal, Odisha) and improved trends in few other states (e.g. Maharashtra, Delhi, Tamil Nadu); b) on domestic retail demand trends, tractor segment continued its strong recovery (table 1) while PVs though in declining trend is recovering (albeit benefiting from base effect) faster vis-à-vis 2Ws. CVs, 3Ws witnessing weakest demand across segments; and c) globally, most countries are witnessing declining workplace mobility trends (e.g. Europe, US) possibly due to rising Covid cases while mobility data in Asia is resilient.

Key observations

* In India, workplace mobility data after witnessing improvements in May/Jun’20, had plateaued in Jul/Aug’20 and has now peaked in Sept’20 across a few states (led by East and South). Overall, the traffic rebound on an aggregate basis saw improvement in transit mobility while workplace mobility remained weak ( down 25% YoY) as East and South India remained most affected (charts 7-10). As for the major metros, Delhi witnessed healthy recovery in traffic movement as it continues to unlock further post reduction of Covid-cases, while other impacted cities like Mumbai/Pune are recovering more modestly.

* On a global basis, a few interesting observations: 1) countries (e.g. Korea, Japan, Canada) that have managed to contain the spread of the pandemic have witnessed both transit station and workplace mobility scaling above normalcy (YoY basis); 2) across all other regions after improvement in workplace mobility trends reaching ~70-80% of pre-Covid levels are now witnessing reversal as regions like Europe are impacted by the second wave. India workplace mobility improvement continues to remain tepid; 2) TomTom data also corroborates Google data with cities like Berlin, Munich, Paris, Beijing having recovered to almost pre-Covid traffic levels (YoY); and 3) few European countries like France and Spain have started to witness sharp declines (mid-Oct’20) vis-a-vis other peer nations (charts 1-10).

* India’s state-wise retail analysis indicates continued softness in retail sales across key categories. Registrations growth trend continued for tractors (up 51% YoY) while all other segments witnessed declines. PV OEMs have seen relatively better MoM registration (up 24% MoM/down 12% YoY) as pent-up demand arising from recovering workplace mobility needs in top-cities is supporting demand rebound. While 2-W segment recorded tepid growth on MoM basis even as Oct’20 had strong tailwinds of the festive sentiment (tables 6-10).

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