Bangalore: Retail sales of vehicles in India may take a hit in the last quarter of the fiscal, automobile dealers’ body said on Thursday, reporting a decline of over 5% in December sales to 1.62 million units.
India has mandated vehicle manufacturers to comply with stricter fuel efficiency norms from April 2023, with an aim to reduce carbon emissions. This, Federation of Automobile Dealers Associations (FADA) said, will result in further increase in prices and weaker sales for the quarter ending March 31.
Auto sales numbers are keenly watched, as they are one of the key indicators for assessing private consumption and carry more than 50% weighting in calculating a country’s economic growth.
FADA data on Thursday showed that two-wheeler sales, which account for 60%-70% of total vehicle sales, declined 11.2% to 11,33,138 units.
The body said sales of India’s top bike and scooter makers have fallen due to high inflation, rise in cost of ownership and the rural market yet to fully gain momentum. It also said that the growth in electric-vehicle (EV) sales has hurt the internal combustion engine two-wheeler segment.
Hero MotoCorp – the world’s largest bikemaker – saw a sharp drop in retail sales, reducing its market share to 29.1% for the month from 34.8% a year ago. The New Delhi-based firm has faced competition from Honda’s Indian two-wheeler unit this year.
FADA said that passenger vehicle (PV) sales for the month rose by about 8.2% to 280,016 units and to exceed 3.43 million units in 2022. The growth in PV sales was likely driven by continued strong demand for utility vehicles (UVs), which have become more popular than entry-level compact cars.
(Reporting by Nandan Mandayam in Bengaluru; Editing by Dhanya N Thoppil and Uttaresh. V)
Disclaimer: This report is generated automatically from Reuters news service. ThePrint is not responsible for its content.