Passenger vehicle sale dips by 24% in September | Why SIAM report is all bad news for auto sector
New Delhi | Jagran Business Desk: Despite a number of measures taken by the Centre, including a sharp corporate tax cut, and a 135 basis point rate cut since February, the domestic vehicle sales plummeted for the 11th straight month in September.
Society of Indian Automobile Manufacturers (SIAM) data released on Friday showed that passenger vehicle (PV) sales during September dropped by 23.69 per cent to 2,23,317 units, down from 2,92,660 units in the year-ago period.
The report, which highlighted that the onset of the festive season failed to up the vehicle sales, further showed that PV sales plummeted by 23.56 per cent in the April-September period as compared with the same period last year.
PV sales had witnessed the worst fall in over two decades in August, slumping by 31.57 per cent to 1,96,524 units from 2,87,198 units a year ago.
SIAM said that the sale of domestic cars in September came down by 33 per cent to 1,31,281 units last month as against 1,97,124 units in the year-ago month.
According to the data, September also witnessed the motorcycle sale dip to the lowest-ever level in over two decades while commercial vehicle sales also declined the worst since January 2009.
Motorcycle sales in September declined 23.29 per cent to 10,43,624 units as against 13,60,415 units a year earlier.
Total two-wheeler sales in September declined 22.09 per cent to 16,56,774 units compared to 21,26,445 units in the year-ago month.
Similarly, sales of commercial vehicles were down 39.06 per cent to 58,419 units in September as compared with 95,870 units in the same period of last year, SIAM said.
Vehicle sales across categories registered a decline of 22.41 per cent to 20,04,932 units from 25,84,062 units in September 2018, it added.
SIAM attributed the decline in the passenger vehicle sales to slowing economy, low consumer sentiment, floods in key markets like Uttar Pradesh, Bihar, Maharashtra, Madhya Pradesh and Kerala, drop in rural demand and increase in insurance cost.
SIAM President Rajan Wadhera, however, expressed hope that with the government announcing various measures to lift the economy, the auto industry may see things improving over the next few months.
"We have seen things improve over the last 10-12 days. Green shoots are visible now. The festive season, measures announced by the government and high discounts have enabled sales growth and helped in improving buyer sentiment in general," he added.
September retail sales data showed a somewhat better picture in terms of sales, pointing to inventory correction taking place in the industry. According to the retail sales data, total automobile sales were up by 6.48 per cent at 17,32,617 units, compared with 16,27,138 units in September 2018.
Posted By: Abhinav Gupta