Two wheeler segment reported YoY growth of 36% and MoM growth of 71%.
| Photo Credit: S.R. Raghunathan

Automobile retail sales witnessed strong growth across all segments in October 2024 with sales rising significantly 32% YoY and 64% MoM, according to data released by Federation of Automobile Dealers Association (FADA) on Wednesday.

All categories reported healthy growth: 2W: grew 36%, 3W: up 11%, PV grew 32%, Tractors 3%, & CV grew 6% on YoY basis.

The rural market played a pivotal role, especially in boosting 2W and PV sales, supported by increased Minimum Support Price (MSP) for Rabi crops, FADA said.

Two wheeler segment reported YoY growth of 36% and MoM growth of 71%. The convergence of major festivals (Navratri & Diwali) in October significantly boosted consumer demand, FADA said.

Festive offers, new model launches, and improved stock availability drove strong performance, it said.

Rural sentiments, supported by favourable monsoons and good crop expectations, further contributed to growth, it added.

Passenger Vehicle (PV) segment grew by 32% YoY and 75% MoM driven by festive demand, aggressive offers, and new model introductions. SUV demand remained strong, but dealer inventories remained high at 75–80 days, raising concerns about continued discounting through year-end, FADA said.

Commercial Vehicle (CV) segment witnessed modest 6% YoY growth, supported by agricultural demand and bulk purchases for container movements. Festive season demand helped, but challenges such as sluggish construction activities and increased vehicle prices affected overall growth, FADA said.

The upcoming wedding season, with 4.8 million weddings expected across India in November and December, is likely to fuel strong demand for two wheeler and passenger vehicle segments. Good crop yields and positive rural sentiments are expected to further drive sales in the near term said FADA.

However, PV inventories remain high, and OEMs have been urged to rationalize supply to prevent excess stock at dealerships. Dealers in the CV segment remain cautious due to slow construction activities, financial constraints, and expected post-festivity demand declining, FADA said.

Though auto dealers remain optimistic about near-term growth, particularly with the wedding season ahead, the potential challenges such as inventory overstock and economic headwinds could affect sales momentum towards the end of the year.