Most companies see an increase in car sales in January thanks to a robust order book and ongoing demand.
Car dispatches at most firms rose at a sharp pace in January on improved production, a strong order book and a continuing robust demand, show vehicle dispatch data released by carmakers on Wednesday. Auto firms in India count dispatches to dealers as sales.
Even though uncertainties with regards to supply chain remain, production continues to improve in a staggered manner.
Cumulative dispatches at car companies are estimated to have risen to 3,46,000 up 17,4% from 2,95,000 units in January 2022.
Shashank Srivastava, senior executive officer, marketing and sales, Maruti Suzuki India said, the industry began with a low network stock because of high retails in December. This depleted inventory pipeline was filled with higher wholesales for the month. The depleted inventory, he pointed out, resulted in slightly muted retails, taking up the network stock to 184,000 units.
During the month, domestic PV sales at Maruti and most of the other manufacturers including Hyundai Motor India, Tata Motors, Mahindra & Mahindra, Kia Motors India and Toyota rose at a fat clip in January over the same month a year ago.
Society of Indian Automobile Manufacturers (Siam) estimates car sales to end the year with 3.85 million in fiscal 2022-23. It’s expected to touch 4.05 million units in 2023-24, it said at a recent industry event. This should translate into a 5-6% growth over FY23.
The Economic Survey estimates India’s economy to grow 6-6.8% giving hopes to the automakers that despite a high inflation and price hikes, demand for automobiles will remain strong. The rebate in income tax and higher capex in infrastructure projects announced in the Budget today will boost disposable income and help auto sales, said executives at auto firms.
“The Budget has struck the right balance between managing growth and fiscal prudence. The reduction in income tax and other taxes will put more money in the hands of consumers, driving consumption and growth in the economy,” said Rajesh Jejurikar – executive director (auto and farm sectors)
The Government’s focused investments in infrastructure will support long term sustainable economic growth. The budget enhances the positive sentiment in the country when the global environment has uncertainty.”
A price hike by various passenger vehicle makers have not dissuaded buyers and the enquiries and bookings have been steady. “Constraints of production continue due to semiconductor supply situation, which resulted in some loss in wholesales as well as retail. This issue is expected to continue for a few more months,” added Srivastava. Maruti has a pending booking of 375,000 units, he said.