FADA Releases April’23 Vehicle Retail Data

•    FY'24 Kicks-off with Modest Vehicle Retail Performance in April.
•    April sees a 4% decline in total vehicle retails, signalling a slow start to FY'24.
•    Healthy YoY growth of 57% observed in 3-wheelers, while Tractor and CV experience marginal growth of 1% and 2%, respectively.
•    2-wheelers and passenger vehicles face a setback, declining by 7% and 1% respectively.
•    For the first time in eight months, passenger vehicles witness a YoY degrowth.
•    Entry-level 2-wheeler segment continues to struggle, down by 19% compared to pre-COVID April 2019, contributing to a 12% decline in total vehicle retails.
•    FADA urges GST Council to consider a GST rate reduction from 28% to 18% for 2-wheelers to help revive the struggling segment.
•    OBD 2A norms lead to vehicle price increases, prompting advanced purchases in March.
•    Unfavourable weather conditions in April, including untimely rains and hailstorms, cause crop damage in several states, exacerbating farmer concerns and potentially impacting entry-level 2-wheeler and passenger car sales.
 
 
Mumbai, May 4, 2023: The Federation of Automobile Dealers Associations (FADA) today released Vehicle Retail Data for April’23.
 
April’23 Retails
Commenting on April 2023's performance, FADA President Mr. Manish Raj Singhania stated, "Financial Year 2024 began on a subdued note, with the month of April experiencing a 4% YoY overall decline. Although the 3-wheeler segment enjoyed robust growth of 57% YoY, Tractor and CV segments only grew by a modest 1% and 2%, respectively. Meanwhile, the 2-wheeler and Passenger Vehicle categories experienced YoY degrowth of 7% and 1%, respectively.
 
The 2-wheeler segment's continued low sales, with a 7% YoY decrease, can be attributed to limited supplies due to the OBD 2A shift, untimely rains, and pre-buying in March. Model mix availability, rural sentiment, and demand in the 2-wheeler motorcycle segment remain weak. The rural economy has yet to show significant progress. Compared to the pre-COVID April 2019, 2-wheeler sales are still down by 19%.
 
Thanks to high demand in the e-rickshaw and passenger segments, the 3-wheeler segment has grown by 57% YoY and also surpassing pre-COVID levels at an healthy rate.
 
The Passenger Vehicle segment, which achieved record sales in FY23, slowed down in April, with retails decreasing by 1% YoY. This was primarily due to last year's high base and the OBD 2A norms, which led to vehicle price increases and advanced purchases in March. Although supplies are improving, there is a significant mismatch between customer demand and available inventory. Furthermore, entry-level PVs have fewer buyers, suggesting that customers at the bottom of the pyramid are still hesitant to upgrade from 2-wheelers to 4-wheelers. For the first time in eight months, the PV segment witnessed a YoY degrowth, potentially signalling a tapering demand in this segment.
 
The CV segment maintained positive momentum with a 2% YoY increase in retail sales. However, dealers reported that vehicle availability was a major concern due to the OBD 2A norms. The low base from last year also contributed to the positive growth."