The Federation of Automobile Dealers Associations (FADA) today released Vehicle Retail Data for November’21.
November’21 Retails
Commenting on how November’21 performed, FADA President, Mr. Vinkesh Gulati said, “Auto retail for the month of November continued to remain in negative zone despite Diwali as well as marriage season in the same month. The unwanted rains in southern states further spoiled the party. Unless Rural India starts showing signs of strength, overall retails will continue to remain weak.
While the 2W segment saw almost at par sales compared to last year (which itself was a bad year), overall sentiment remained low as marriage season also didn’t help in revival except in one or two states. Apart from this, crop loss due to incessant rains and flood in southern states, high acquisition price as well as fuel costs kept the customers away. Further, there are no signs of increase in inquiry levels which is a bigger cause of concern.
PV continues to face the brunt of semi-conductor shortage. While the new launches are keeping customer’s interest high, it is only the lack of supply which is not allowing sales to conclude. The extended waiting period is now starting to make customers jittery and this may lead to loss of interest in vehicle buying.
The CV segment continues to see traction in M&HCV segment. This aided by low base resulted in double digit growth. The bus segment is still witnessing a dry run as educational institutes continue to remain closed. With diesel prices at record highs, supply of CNG vehicles are not able to meet the demand. Tight liquidity and unavailability of finance for customers who availed moratorium are also acting as sales barrier.”
Near Term Outlook
The new variant of Covid ‘Omicron’ has once again gripped the entire nation in fear. This will further impact the overall vehicle demand.
Educational Institutions and offices which were planning to reopen fully have once again deferred their plans and are allowing work/study from home. Price rise due to high input costs and high fuel costs are continuing to add customers woes.
FADA is hopeful that the chip shortage will ease in times to come and therefore reduce waiting period of vehicles and help in increasing sales. On the 2W front, we once again request all OEMs to announce attractive scheme which can work as a stimulus for growth in sales. FADA additionally requests them to consistently work on a 21- days inventory cycle.
Overall, we remain extremely cautious and hope that India does not see a 3rd wave with the new Covid variant. We also urge the Central as well as all State Governments to aggressively drive the vaccination coverage so that India is not caught off-guard and recovery to pre-covid levels is not derailed.
Key Findings from our Online Members Survey
Inventory at the end of November’21
Average inventory for Passenger Vehicles ranges from 10 – 15 days
Average inventory for Two – Wheelers ranges from 30 – 35 days
Liquidity
Good = 39.5%
Neutral = 36.5%
Bad = 24%
Sentiment
Neutral = 38.9%
Good = 32.3%
Bad = 28.7%
Expectation in December
De-growth = 45.5%
Flat = 38.3%
Growth = 16.2%
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