Retail sales of vehicles across categories in India declined 4.31 per cent year-on-year to 1.96 million units in July, reflecting weak consumer sentiment on a high base. While tractor sales posted strong double-digit growth, passenger vehicles and two-wheelers saw declines, and commercial vehicle sales remained largely flat. Robust rainfall and substantial crop sowing boosted tractor demand, according to registration data from the VAHAN portal compiled by the Federation of Automobile Dealers’ Associations (FADA), cited by Economic Times. Two-wheeler registrations fell 6.5 per cent to 1.36 million units, passenger vehicle sales slipped 1 per cent to 328,613 units, and commercial vehicle registrations held steady at 76,439 units. Three-wheeler sales inched up 0.8 per cent to 111,426 units. Tractor sales rose 11 per cent to 88,722 units. “After three consecutive months of growth, India’s auto retail sector applied the brakes in July, with overall retails declining by 4.31% YoY,” said C S Vigneshwar, president, FADA. “This pullback largely stems from a high-base effect in July 2024, when an extreme heat wave was immediately followed by excessive rainfall, constraining volumes before a rebound later that month.” The two-wheeler segment saw reduced rural footfall due to crop-sowing activities and sustained heavy rainfall. Dealers expect sales to pick up post-monsoon, with many purchases postponed to August ahead of the festive period, Vigneshwar added. In the passenger vehicle segment, rural markets outperformed urban ones, with dealer inventory at 55 days. Maruti Suzuki retained its lead, while Hyundai Motor India overtook Mahindra & Mahindra for the No. 2 spot, selling 43,009 units versus M&M’s 42,207 units. Commercial vehicle sales posted a marginal 0.2 per cent increase, aided by new product launches, marketing campaigns, institutional orders, and adequate stock availability. “Rural haulage demand, however, remained fragmented amid heavy rainfall, seasonal softness in cement, coal and construction logistics, and slower financier disbursements, prompting many buyers to defer purchases to the post-monsoon period,” said Vigneshwar. The tractor segment’s growth was supported by timely and enhanced farm subsidies alongside favourable monsoon conditions.
